[Apartment Official Price Announcement] Nationwide 5.99% Increase This Year, Higher Realization Rate for Over 900 Million Won

[Asia Economy Reporter Yoo In-ho] This year, the official price of apartment complexes nationwide is expected to rise by 5.99%.

The realization rate for apartments priced over 900 million KRW was increased. Due to the rise in official prices, the burden of holding taxes has also significantly increased.

◆ Increased realization rate mainly for apartments priced over 900 million KRW = The Ministry of Land, Infrastructure and Transport announced the planned official prices for 13.83 million apartment units nationwide on the 18th. The final confirmed prices will be announced on the 29th of next month after hearing owners' opinions.

This year, the official prices of apartment complexes focused on increasing the realization rate for high-priced housing, which accounts for 4.8% (663,000 units) of the total and are priced at 900 million KRW or more. For mid- to low-priced apartment complexes, changes in official prices reflected the rate of market price increases.

In fact, the official prices of apartment complexes priced below 300 million KRW fell by 1.9% this year. Last year, it also recorded -2.48%.

On the other hand, prices for apartments priced between 300 million KRW and 600 million KRW rose by 3.93%. Those priced between 600 million KRW and 900 million KRW increased by 8.52%. Apartments priced between 900 million KRW and 1.2 billion KRW surged by 15.2%, and those between 1.2 billion KRW and 1.5 billion KRW jumped by 17.27%. Apartments priced between 1.5 billion KRW and 3 billion KRW rose by 26.18%, and those over 3 billion KRW increased by 27.39%. The higher the price range, the higher the official price increase rate.

Accordingly, the realization rate of official prices for apartment complexes (market price reflection rate) recorded 69%, similar to last year's 68.1%. Apartments priced below 900 million KRW (13.17 million units) showed a realization rate similar to the previous year, while those priced between 900 million KRW and 1.5 billion KRW increased by 2 to 3 percentage points, and those over 1.5 billion KRW rose by 7 to 10 percentage points. This resolved the fairness issue where high-priced housing had a lower realization rate.

◆ Nationwide increase of 5.99% = This year, the official price change rate for apartment complexes nationwide was surveyed at 5.99%, up 0.76 percentage points from last year's 5.23%. Seoul saw the highest increase at 14.75%.

Following were Daejeon (14.06%), Sejong (5.78%), and Gyeonggi (2.72%). Regions such as Busan, Incheon, and Gwangju had official price change rates below 1%. Conversely, Gangwon, Gyeongbuk, Gyeongnam, Chungbuk, Chungnam, Jeonbuk, Ulsan, and Jeju saw official prices decline compared to the previous year.

About 6.22 million housing units had official prices lower than the previous year. Approximately 582,000 units (4%) saw official prices rise by more than 20% compared to the previous year.

A Ministry of Land official explained, “In Seoul and some metropolitan areas, the official price increase rate was relatively high due to increased demand for apartments and the impact of redevelopment and various development projects. On the other hand, in Ulsan, Gyeongnam, and Chungbuk, official prices declined due to decreased housing demand caused by regional economic slowdown and population decline.”

◆ Government to review measures to minimize burden on low-income households = The government plans to take necessary measures, such as adjusting eligibility criteria, to minimize the burden on low-income households caused by increased taxes, health insurance premiums, and welfare benefits due to the rise in official prices.

Regarding health insurance premiums, after the official prices are finalized, the government will review system improvements to reduce the burden by examining changes in subscribers' premiums and eligibility.

The basic pension will adjust the calculation criteria next year by reflecting changes in the official prices of real estate owned by elderly people aged 65 and over. Basic livelihood security recipients are expected to have minimal changes as they either do not own housing or own low-priced housing, but additional protection measures will be prepared within the year if necessary.

The planned official prices for apartment complexes can be checked on the Real Estate Official Price Notification website from the 19th until the 8th of next month. If there are any opinions, they can be submitted online or to the city/county/district office or the Korea Appraisal Board branch by the 8th of next month.

The official prices for apartment complexes will be finalized and announced on the 29th of next month after hearing owners' opinions and deliberation by the Central Real Estate Price Public Notice Committee.

The roadmap for official price realization will be announced in October after a social public discussion process including expert forums (July) and public hearings (August). Based on this, it will be applied to real estate official prices starting next year.

Kim Young-han, Director of Land Policy at the Ministry of Land, said, “High-priced housing, which had a lower realization rate compared to low-priced housing, resolved the reversal phenomenon by raising the realization rate, and the reversal phenomenon between different housing sizes was also improved, actively enhancing fairness.” He added, “We will establish a timely realization roadmap to fundamentally improve and balance official prices.”

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