Office-tel 'Sale, Jeonse, Monthly Rent' Rising Alone in Seoul

Nationwide Sale Prices Down 0.06% 'Weak Trend'
Regional Areas See Relatively Large Declines in Sales and Monthly Rent Comparisons

(Data from Korea Real Estate Board)

[Asia Economy Reporter Moon Jiwon] The gap between the officetel markets in Seoul and other regions is widening. In the fourth quarter of last year, the Seoul officetel market showed strength with rising prices in both sales and jeonse (long-term deposit lease) and monthly rent, while other regions struggled due to weakened demand.

According to the officetel price trend survey by the Korea Real Estate Board on the 2nd, the sales price of officetels in Seoul increased by 0.4% in the fourth quarter of last year compared to the previous quarter. The Korea Real Estate Board explained, "Prices rose due to continuous apartment price increases and government regulations on housing, which led to substitute investment demand focused on areas near subway stations and close to workplaces."

However, nationwide, sales prices declined by 0.06%, showing a weak trend. In Gyeonggi-do, continued supply caused inventory accumulation, resulting in a 0.32% drop compared to the previous quarter. Officetel prices in other regions also fell by 0.39% as major areas such as Busan and Ulsan experienced economic downturns. The Korea Real Estate Board analyzed that demand was dispersed due to population decline and alternative products such as urban lifestyle housing and small-to-medium-sized apartments.

Jeonse prices for officetels rose by an average of 0.06% nationwide, with Seoul recording a 0.4% increase, significantly exceeding the average. This is interpreted as a result of expanding tenant preference for jeonse, leading to rising prices. In other regions, some areas such as Sejong (0.56%) and Daegu (0.40%) showed an upward trend, but overall, prices fell by 0.22% due to oversupply. Gyeonggi-do and Incheon also dropped by 0.17% each compared to the previous quarter.

Monthly rent prices fell in most areas, including nationwide (-0.21%), the metropolitan area (-0.16%), and other regions (-0.46%), with only Seoul (0.06%) and Daegu (0.01%) showing increases. Notably, Gwangju (-2.02%) and Ulsan (-0.87%) experienced significant declines.

In the fourth quarter of last year, the average sales price of officetels was 228.39 million KRW in Seoul, followed by Gyeonggi-do (168.22 million KRW) and Busan (130.49 million KRW). The average jeonse price was 178.38 million KRW in Seoul, 141.90 million KRW in Gyeonggi-do, and 95.34 million KRW in Busan. Monthly rents were 769,000 KRW in Seoul, 643,000 KRW in Gyeonggi-do, 478,000 KRW in Busan, and 475,000 KRW in Daejeon, respectively.

This content was produced with the assistance of AI translation services.