Seoul Apartment Prices Down 0.07%... Negative in Gangnam 4 Districts, Yeongdeungpo, Yongsan, and More

[Asia Economy Reporter Yuri Kim] Apartment prices in Seoul fell by 0.07%, marking five consecutive weeks of decline. Since turning weak at the end of March (March 27, -0.01%), the rate of decline has gradually widened. The ruling party's landslide victory in the April 15 general election has raised expectations that the regulatory-focused real estate policy stance will be maintained, leading to an increase in disappointment sales. As the tax assessment date for property holding tax on June 1 approaches, tax-avoidance sales by multi-homeowners also seem to be on the rise. With negative growth realized in the first quarter of this year, areas sensitive to the economy such as the Gangnam 4 districts (Gangnam, Seocho, Songpa, Gangdong), as well as Yongsan and Yeongdeungpo, have joined the decline. Among the 25 districts in Seoul, six districts have turned weak, gradually increasing the number of areas in decline. On the other hand, the number of districts with price increases dropped noticeably to 14, compared to 21 in mid-March.

According to Real Estate 114 on the 24th, apartment sale prices in Seoul fell by 0.07% compared to the previous week, marking five consecutive weeks of decline. Redevelopment and general apartments recorded -0.18% and -0.06%, respectively, widening the decline. New towns and Gyeonggi/Incheon rose by 0.01% and 0.05%, respectively, but the rate of increase slowed. Including Seoul, the entire metropolitan area fell by 0.02%, marking a decline for the first time in about a year.

In Seoul this week, the decline widened not only in redevelopment but also in general apartments, centered around Songpa and Seocho. The districts fell in the order of Songpa (-0.35%), Seocho (-0.17%), Gangnam (-0.13%), Gangdong (-0.13%), Yongsan (-0.12%), and Yeongdeungpo (-0.01%). In Songpa-gu, apartments such as The Ricenz, Parkrio, Els, Lake Palace, and Trizium located in Jamsil-dong and Sincheon-dong dropped by 10 million to 75 million KRW. In Seocho, Banpo-dong's Banpo Xi and Raemian Banpo Firstige fell by 25 million to 50 million KRW. In Gangnam, Daechi-dong's Eunma and Apgujeong-dong's Shin Hyundai dropped by 25 million to 50 million KRW. In Yongsan, Daewoo in Ichon-dong fell by 35 million to 50 million KRW, and in Yeongdeungpo, Samsung Raemian 4th in Dangsan-dong dropped by 2.5 million to 7.5 million KRW. On the other hand, Gangbuk (0.09%), Seodaemun (0.08%), Gwanak (0.08%), Guro (0.07%), and Seongbuk (0.06%) rose.

New towns rose in the order of Jungdong (0.03%), Dongtan (0.03%), Bundang (0.01%), Ilsan (0.01%), and Pangyo (0.01%). In Jungdong New Town, Eunha Hyosung and Eunha Ssangyong in Jungdong rose by 5 million KRW. In Dongtan, Dongtan Solbit Village Ssangyong Yega in Bansong-dong and Neungdong Pureun Village Moa Miraedo rose by 5 to 10 million KRW. Bundang's Yatap-dong Jangmi Dongbu rose by 5 to 10 million KRW.

In Gyeonggi and Incheon, Incheon's rise stood out due to relatively undervalued attractiveness. The areas rose in the order of Incheon (0.09%), Anyang (0.09%), Osan (0.09%), Suwon (0.08%), Guri (0.07%), Uiwang (0.07%), and Hanam (0.07%). In Incheon, major complexes such as Guhwol Hills State 1st Complex in Guhwol-dong, Namdong-gu; Bugae Station Prugio in Bugae-dong, Bupyeong-gu; Lin Strauss in Cheongna-dong, Seo-gu; Songdo The Sharp Central Park in Songdo-dong, Yeonsu-gu; and Hanla Vivaldi in Jungsan-dong, Jung-gu rose by about 5 million KRW. In Anyang, Pyeongchon The Sharp I-Park in Hogye-dong rose by 5 to 10 million KRW, and Raemian Anyang Megatria in Anyang-dong rose by 5 million KRW. Osan's Osan Sema e-Pyeon Sesang in Yangsan-dong rose by 10 million KRW. On the other hand, Gwacheon fell by 0.10%. After wavering between stable and decline recently, the decline widened. Raemian Sur 3rd Complex in Wonmun-dong fell by 5 to 10 million KRW.

The jeonse (long-term lease) market showed relatively stable trends compared to January to March this year, with changes of 0.03% in Seoul, 0.02% in new towns, and 0.02% in Gyeonggi/Incheon. Despite the spring moving season, social distancing continued due to the novel coronavirus infection (COVID-19), greatly suppressing the movement of demanders.

In Seoul's jeonse market, apartments in non-Gangnam areas with relatively less price burden are leading the rise. By region, Seodaemun (0.13%), Seongbuk (0.09%), Gangbuk (0.08%), Gangdong (0.07%), Songpa (0.07%), Gangnam (0.05%), Dobong (0.05%), Dongjak (0.04%), and Nowon (0.03%) rose. In Seodaemun, Doosan in Hong Eun-dong, Inwangsan Hyundai in Hongje-dong, and Hongjewon Hyundai rose by 5 to 30 million KRW. In Seongbuk, Raemian La Sente in Jongam-dong and Gireum New Town 2nd Complex (Prugio) in Gireum-dong rose by 5 to 15 million KRW. In Gangbuk, Byeoksan Live Park in Mia-dong and Byeoksan in Suyu-dong rose by 5 to 10 million KRW.

New towns rose in the order of Gimpo Hangang (0.06%), Gwanggyo (0.06%), Ilsan (0.05%), Dongtan (0.03%), Jungdong (0.01%), and Pangyo (0.01%). In Gimpo Hangang, the 1,230-unit complex Gimpo Hangang IPARK in Gurae-dong rose by 5 million KRW. In Gwanggyo, Gwanggyo Hoban Verdiem in Woncheon-dong rose by 5 million KRW. In Ilsan, Moonchon 16th Complex New Samik and Gangseon 15th Complex Boseong in Juyop-dong rose by 5 million KRW.

In Gyeonggi and Incheon, Anyang (0.07%), Guri (0.06%), Yongin (0.06%), Icheon (0.03%), Pyeongtaek (0.03%), and Hwaseong (0.03%) rose. In Anyang, Hogye 2nd Hyundai Hometown in Hogye-dong and Indeokwon Daewoo Pureun Village in Pyeongchon-dong rose by 5 to 7.5 million KRW. In Guri, Topyeong SK and Shinil in Topyeong-dong rose by 10 million KRW. In Yongin, Manhyeon Village 10th Complex IPARK in Sanghyeon-dong rose by 10 million KRW. On the other hand, Gwacheon fell by 0.13% due to the move-in impact of the 1,571-unit Gwacheon Prugio Summit and the strengthening of the first-priority subscription residence period, reducing move-in demand. Jugong 4th Complex in Byeolyang-dong fell by 5 to 10 million KRW.

Yoon Ji-hae, senior researcher at Real Estate 114, explained, "The decline that started in Seoul's redevelopment apartments is expanding to general apartments and non-Gangnam areas such as Yongsan and Yeongdeungpo," adding, "The areas that rose the most during the uptrend are leading the decline." She forecasted that this trend will accelerate for the time being. She said, "With the ruling party's landslide victory in the general election, speculative demand regulations focusing on loans, taxes, subscriptions, and source of funds investigations are likely to continue throughout this year," adding, "Moreover, the first quarter economic growth rate recorded -1.4%, the lowest in 11 years. Considering that the real estate market also experienced a prolonged decline during past economic downturns, a weak trend is inevitable for the time being."

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