Daechi·Jamsil "No Houses Available"... Education Hub Faces 'Jeonse Crisis'

Shortage of Listings Causes Price Surge... "Contracts Signed Immediately"
Popular School Districts Like Daechi, Jamsil, Junggye, Mokdong
Scarcity of Listings Drives Prices Up by 50 Million to 100 Million Won
Demand Slows After Moving Season but Remains Unstable

Apartment complex in Daechi-dong, Gangnam-gu, Seoul (Photo by Yonhap News)

[Asia Economy Reporter Moon Jiwon] "There are absolutely no listings. Since there are waiting lists, contracts are made immediately regardless of the price as soon as a property comes up." (Representative of A Real Estate Agency in Daechi-dong)

This was the situation in the apartment jeonse market in Daechi-dong, Gangnam-gu, Seoul, known as the "No.1 Education District," last weekend. The government's real estate measures have caused a balloon effect in the jeonse and monthly rent markets, and the feared jeonse crisis has become a reality.

According to frontline real estate agencies on the 6th, major areas in Seoul such as Daechi-dong in Gangnam-gu, Jamsil-dong in Songpa-gu, and Junggye-dong in Nowon-gu, where school district demand is concentrated ahead of the vacation, are experiencing a shortage of jeonse listings and a sharp rise in prices. Tenants who have not found a house before the new semester are frustrated as they cannot find suitable jeonse homes. As a result, there are continuous cases where tenants reluctantly sign contracts despite asking prices being raised by tens of millions of won.

◇ Daechi-dong and Jamsil, Jeonse Listings Have Dried Up = As the moving season during the vacation begins, real estate offices in Daechi-dong explain that it is almost impossible to find jeonse listings in the area. The representative of W Real Estate in Daechi-dong said, "There are no jeonse listings," adding, "There are still one or two half-jeonse or monthly rent listings, but jeonse properties are all contracted on the same day as soon as they come out." A representative of nearby S Real Estate also said, "Jeonse listings are scarce throughout Daechi-dong," adding, "Even if landlords raise prices by at least 50 million to 100 million won, there are waiting lists."

Desperate tenants are turning their eyes to nearby multi-family and row houses. The representative of D Real Estate, which specializes in brokerage for multi-family and row houses in the area, said, "Parents trying to get middle school assignments make up the majority," adding, "Recently, as the threshold for jeonse loan approvals has risen, inquiries about monthly rent have increased."

In fact, Mr. Kim, who lives in Yeongdeungpo-gu, has taken annual leave to move to Daechi-dong and has been searching for jeonse listings but has come up empty for several days. He sighed, saying, "There are no listings in complexes where I can walk to the desired school," and "Now I am considering looking for areas where I can commute by car."

[Image source=Yonhap News]

◇ Small-sized Listings Disappear in Junggye-dong Area = Nowon-gu Junggye-dong, a representative popular school district area in northern Seoul, is also experiencing a jeonse crisis. Complexes near Eungwang Intersection, where famous academies are concentrated, and popular schools such as Seorabeol High School and Yeongsin High School are facing a shortage of listings. The representative of E Real Estate near Eungwang Intersection said, "This year, the total number of listings is less than half compared to last year because there are so few jeonse properties," adding, "There are no 20-pyeong (approx. 66 sqm) units, and if 30-pyeong (approx. 99 sqm) units come out, the minimum price is around 500 million won."

For example, the jeonse price for a 49㎡ unit in Jugong Complex 8 in Junggye-dong is currently around 210 to 220 million won. Compared to last summer, the price has risen by up to 40 million won. The 58㎡ unit in Jugong Complex 10 has seen a price increase since last fall, with jeonse prices trading around 320 million won. A representative of nearby B Brokerage Office said, "Houses with interior renovations have recently been traded at 360 million won," adding, "However, most tenants have already moved in, so the price increase may slow down."

According to the Korea Real Estate Board, as of December 30 last year, the apartment jeonse prices in 11 districts south of the Han River in Seoul rose by 0.29% compared to the previous week, significantly exceeding the Seoul average (0.19%) and the 14 districts in northern Seoul (0.08%). In particular, price increases were notable in the Gangnam 3 districts?Gangnam-gu (0.49%), Songpa-gu (0.25%), Seocho-gu (0.31%)?and Yangcheon-gu (0.61%), which includes the Mokdong New Town, areas known for good school districts and academy clusters.

The Korea Real Estate Board analyzed, "Due to new semester school district demand during the winter vacation moving season and subscription waiting demand, the upward trend continued mainly in major school district areas and areas near subway stations."

However, some analysts suggest that moving demand considering new semester school assignments is coming to an end, so the jeonse shortage may ease around the Lunar New Year holiday at the end of this month. The representative of H Real Estate in Jamsil-dong said, "Although there are no jeonse listings, demand seems to have peaked," adding, "However, depending on additional government measures, the market may still fluctuate in the short term."

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