"Apartment Prices in Gangnam 4 Districts Fall Uniformly After 1 Year... Gyeonggi's 'Suyongseong' Leads Continued Rise"

[Asia Economy Reporter Kim Yuri] Apartment sale prices in four districts of Seoul?Gangnam, Seocho, Songpa, and Gangdong?have all turned downward simultaneously for the first time in over a year. The ban on loans for ultra-high-priced apartments exceeding 1.5 billion KRW directly impacted the Gangnam area, and with the spread of the novel coronavirus disease (COVID-19), the proportion of apartment sales transactions in Gangnam within the entire Seoul market shrank to around 12-13%. Meanwhile, non-Gangnam areas, with fewer regulations, continued an upward trend led by mid- to low-priced apartments. Price increases also persisted in areas of Gyeonggi Province such as Suwon, Yongin, and Seongnam, which are included in the adjustment target areas.

According to Real Estate 114 on the 13th, apartment sale prices in Seoul rose by 0.04% this week. The rate of increase has slowed for two consecutive weeks. While redevelopment apartments fell by 0.05%, general apartments rose by 0.06%. New towns and Gyeonggi/Incheon areas increased by 0.03% and 0.14%, respectively, maintaining similar growth rates as the previous week.

In Seoul, demand flowed into non-Gangnam areas with many mid- to low-priced apartments, driving the upward trend. The increases were in the order of Gwanak (0.19%), Seongbuk (0.19%), Nowon (0.17%), Dobong (0.13%), Mapo (0.11%), Guro (0.10%), Geumcheon (0.10%), and Seodaemun (0.10%). In Gwanak, apartments such as Gwanak Prugio in Bongcheon-dong, Bongcheon Woosung, and Samsung San Jugong 3 Complex in Sillim-dong rose by 2.5 to 20 million KRW. In Seongbuk, Raemian Gileum Centerpiece in Gileum-dong, Seongbuk Hillstate in Hawolgok-dong, and Dream Forest Prugio increased by 10 to 25 million KRW. In Nowon, Sangye Jugong 1 and 3 Complexes in Sangye-dong rose by 15 to 25 million KRW. Conversely, Gangdong (-0.06%), Seocho (-0.02%), Songpa (-0.01%), and Gangnam (-0.01%) declined. This is the first time in a year since March 22 last year that all four Gangnam districts recorded negative changes simultaneously. In Gangdong, Lotte Castle First in Amsa-dong fell by 15 to 40 million KRW, and in Seocho, Acro River Park Banpo and Jugong 1 Complex in Banpo-dong dropped by 10 to 25 million KRW.

New towns rose in the order of Jungdong (0.07%), Sanbon (0.06%), Bundang (0.04%), Dongtan (0.04%), Pyeongchon (0.03%), Ilsan (0.02%), and Gwanggyo (0.01%). The upward trend is particularly clear in relatively undervalued, non-regulated areas of metropolitan new towns. In Jungdong, apartments such as Eunha Hyosung, Eunha Ssangyong, and Kkum Samhwan Hanjin rose by 5 to 10 million KRW. In Sanbon, Eulji Samik in Sanbon-dong, Hanil and Gaya 5 Complex Jugong 1st Phase, and Geumgang Jugong 9 Complex 2nd Phase increased by 7.5 to 10 million KRW.

In Gyeonggi and Incheon, the so-called 'Suyongseong' areas?Suwon (0.32%), Yongin (0.29%), and Seongnam (0.29%)?continued to show strength. Uiwang (0.22%), Gwacheon (0.19%), Anyang (0.18%), and Hanam (0.14%) also showed strong upward trends. In Suwon, Suwon Gwonseon Xi e-Pyeonhan Sesang in Gwonseon-dong rose by 10 to 15 million KRW, Suwon LH Central Town in Seryu-dong increased by 5 to 20 million KRW, and Cheoncheon Daewoo Prugio in Cheoncheon-dong jumped by 5 to 10 million KRW. In Seongnam, Jungang-dong Hillstate 1st Phase and Dochon-dong Humansia Island Village 3 Complex rose by 5 to 10 million KRW. In Yongin, Hillsstate Giheung in Gugal-dong and Eojeong Village Lotte Castle Eco 1 Complex in Jungdong increased by 10 to 20 million KRW.

Despite the impact of COVID-19, the jeonse (long-term lease) market saw localized price increases centered on popular areas with convenient transportation, where listings are scarce. Seoul rose by 0.05%, while new towns and Gyeonggi/Incheon increased by 0.01% and 0.03%, respectively.

In Seoul, increases were in the order of Geumcheon (0.16%), Gwanak (0.15%), Seongbuk (0.11%), Gangseo (0.09%), Gangbuk (0.08%), Mapo (0.08%), Yangcheon (0.08%), Gangnam (0.07%), and Jung-gu (0.07%). In Geumcheon, Nam Seoul Hillstate in Siheung-dong rose by 5 to 10 million KRW. In Gwanak, Geonyeong 3rd Complex in Sillim-dong and Doosan in Bongcheon-dong increased by 10 to 15 million KRW. In Seongbuk, Kaiser Palace in Jongam-dong, Wolgok Raemian Luna Valley in Hawolgok-dong, and Dream Forest Prugio rose by 5 to 20 million KRW. In Gangseo, Gayang 6 Complex and Gangbyeon in Gayang-dong increased by 5 to 20 million KRW.

New towns rose in the order of Gwanggyo (0.05%), Ilsan (0.03%), Bundang (0.02%), Sanbon (0.02%), and Jungdong (0.01%). In Gwanggyo, Gwanggyo Sangnok Xi in Sanghyeon-dong rose by 10 million KRW. In Ilsan, Baeksok-dong Baeksong 3 Complex Hanshin, Woosung, and Munchon 5 Complex Ssangyong Hanil, and Munchon 2 Complex Life increased by 5 to 10 million KRW. In Bundang, Jeongja-dong Jeongdeun Woosung 6 Complex and Yatap-dong Jangmi Kolon rose by 5 to 10 million KRW.

In Gyeonggi and Incheon, increases were in the order of Siheung (0.07%), Suwon (0.06%), Yongin (0.06%), Uiwang (0.06%), Goyang (0.04%), and Gwangmyeong (0.04%).

Recently, with strengthened loan regulations in adjustment target areas, submitting a funding plan has also become mandatory for housing transactions over 300 million KRW. Along with concerns about economic contraction due to COVID-19, overall housing transaction volumes are expected to decline. Yoon Ji-hae, senior researcher at Real Estate 114, said, "The four Gangnam districts of Seoul, densely packed with high-priced homes and redevelopment complexes, have all shown a downward trend for the first time in a year, making it difficult to expect the previous upward momentum led by flagship properties." However, the balloon effect in relatively less regulated non-Gangnam areas and nearby Gyeonggi and Incheon remains. With the Bank of Korea likely to cut interest rates further, liquidity effects centered on regions with fewer loan restrictions are expected to continue for the time being.

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