Seoul Apartment Prices Rise for 3rd Week... "Mainly Mid-Low Priced in Non-Gangnam Areas"

Real Estate 114 Analysis, "Balloon Effect Continues with Expanding Price Increase in Gyeonggi and Incheon"
Led by Non-Gangnam Areas and Gyeonggi·Incheon... "Difficult to Assess Impact of Additional Regulations"

[Asia Economy Reporter Yuri Kim] Apartment prices in Seoul rose by 0.03% this week, marking the third consecutive week of increase. The trend has been maintained since the reversal to an upward trend at the end of May. However, due to loan regulations on high-priced housing, limited demand is flowing mainly into mid- to low-priced apartments in non-Gangnam areas rather than in the Gangnam area. In Gyeonggi and Incheon, the rate of increase expanded again in relatively undervalued areas such as Ansan, Incheon, and Namyangju. As signs of instability in sales prices are reappearing across the metropolitan area, the government seems to be rushing additional measures.

According to Real Estate 114 on the 12th, the weekly change rate of apartment sales prices in Seoul recorded 0.03%, the same as last week. Reconstruction prices rose by 0.08%, expanding from 0.04% the previous week, and general apartments increased by 0.03%. With the balloon effect continuing, Gyeonggi and Incheon rose by 0.09%, and new towns increased by 0.02%.

In Seoul, prices rose in the following order: Nowon (0.16%), Geumcheon (0.10%), Gwanak (0.08%), Guro (0.08%), Jung-gu (0.08%), Yeongdeungpo (0.07%), Gangbuk (0.05%), Dobong (0.05%), and Yangcheon (0.05%). Most areas with higher increases are concentrated with mid- to low-priced properties under 900 million KRW. In Nowon, Junggye-dong Jungang Heights, Seongwon 2nd Complex, Sanggye-dong Sanggye Jugong 7th Complex, and Bulam Hyundai rose by 5 to 10 million KRW. In Geumcheon, large apartment complexes such as Doosan We’ve in Gasan-dong and Nam Seoul Hillstate increased by 5 million KRW. In Gwanak, Bongcheon-dong Seonghyeon Dong-A and Byeoksan Blooming rose by 5 to 7.5 million KRW. Meanwhile, Yangcheon continued its upward trend due to expectations of passing the safety diagnosis for reconstruction in Mok-dong New Town.

New towns rose in the following order: Ilsan (0.04%), Pyeongchon (0.04%), Bundang (0.03%), Sanbon (0.02%), Jungdong (0.02%), and Dongtan (0.02%). In Ilsan, Madudong Gangchon 1st Complex Dong-A, Baekseok-dong Baeksong 9th Complex Doosan, and Ilsan-dong Hugok 11th Complex Jugong rose by 2.5 to 10 million KRW. In Pyeongchon, Mugunghwa Geonyeong in Hogye-dong and Chowon Hanyang in Pyeongchon-dong increased by 5 million KRW. In Bundang, Mujigae 3rd Complex Shinhan and Geonyeong in Gumi-dong and Jangmi Kolon in Yatap-dong rose by 5 million KRW.

Gyeonggi and Incheon rose in the following order: Ansan (0.16%), Incheon (0.14%), Namyangju (0.13%), Bucheon (0.11%), Uiwang (0.11%), Gwangmyeong (0.10%), Yongin (0.10%), and Osan (0.10%). Relatively undervalued areas seem to be filling the gap. On the other hand, Gwacheon (-0.01%), which is still affected by new housing supply, showed weakness.

In the metropolitan area’s jeonse (long-term lease) market, Seoul rose by 0.05% due to a shortage of listings, while Gyeonggi, Incheon, and new towns increased by 0.06% and 0.03%, respectively.

In Seoul’s jeonse market, low interest rates have led landlords to prefer monthly rent over jeonse, contributing to price increases. The areas rose in the following order: Gangdong (0.20%), Gangbuk (0.18%), Gwangjin (0.18%), Gwanak (0.11%), Seongbuk (0.10%), Geumcheon (0.09%), and Nowon (0.09%). In Gangdong, Godeok-dong Godeok IPARK and Amsa-dong Gangdong Hyundai Hometown rose by 10 to 20 million KRW. In Gangbuk, Mia-dong Gyeongnam Honorsville and Hanil U&AI increased by 5 to 15 million KRW. In Gwangjin, Jayang-dong Jayang 10th Complex Hyundai Hometown and Gwangjang-dong Gwangjang Hyundai 3rd Complex rose by 10 to 25 million KRW.

New towns rose in the following order: Bundang (0.05%), Dongtan (0.05%), Pyeongchon (0.04%), Sanbon (0.04%), Jungdong (0.03%), and Ilsan (0.01%). Gyeonggi and Incheon also saw larger increases due to a shortage of jeonse listings. The areas rose in the following order: Yongin (0.12%), Uiwang (0.11%), Guri (0.10%), Gwangmyeong (0.08%), Hwaseong (0.08%), Incheon (0.07%), and Suwon (0.06%).

Yoon Ji-hae, Senior Researcher at Real Estate 114, said, "Seoul apartment prices have risen for three consecutive weeks, and with signs of further expansion in the rate of increase, the government is weighing the timing of announcing additional measures." However, she added, "The recent upward trend is led more by relatively undervalued non-Gangnam areas and Gyeonggi and Incheon regions rather than high-priced housing in Gangnam, so it is uncertain how much impact regulations such as expanding the scope of regulated areas will have." In particular, among individual areas in the metropolitan area, there are many places where the increase in jeonse prices is higher than that of sales prices. Senior Researcher Yoon diagnosed, "Due to the shortage of jeonse listings, the upward trend in jeonse prices is likely to continue for some time. The demand for gap investment, which is less affected by loan regulations and at historically low interest rates, is more likely to flow into the metropolitan apartment market than in the past."

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