Seoul Apartment Price Increase Triples This Week... Jeonse Price Rise Also Upward

[Asia Economy Reporter Yuri Kim] Despite the announcement of strengthened real estate regulations, apartment prices in Seoul rose by 0.1%, continuing an upward trend for the fourth consecutive week. The increase was more than three times the previous week's rise of 0.03%. The rise in Seoul apartment prices was driven by areas such as Songpa Jamsil, where expectations for the Jamsil Sports and MICE (Meetings, Incentives, Conferences, and Exhibitions) development project have formed, as well as low- to mid-priced apartments concentrated in Nowon, Gangbuk, and Geumcheon. In particular, Songpa rose by 0.31% this week, marking the largest increase since the weekly 0.57% rise at the end of last year (as of December 20). However, the impact of the June 17 measures was not significantly reflected in this week's survey.

According to Real Estate 114 on the 19th, the apartment sale prices in Seoul increased by 0.1%. Both reconstruction apartments and general apartments rose by 0.15% and 0.09%, respectively, with the rate of increase expanding in both categories. Additionally, Gyeonggi and Incheon rose by 0.1%, and new towns increased by 0.03%.

In Seoul, Songpa (0.31%), Nowon (0.22%), Gangbuk (0.16%), Geumcheon (0.15%), Gangdong (0.14%), Gangseo (0.14%), and Gwanak (0.12%) saw price increases. Songpa led the rise in apartment prices around Jamsil following news of the Jamsil MICE development. Apartments such as Jamsil Jugong 5 Complex in Jamsil-dong, Woosung 1, 2, and 3 complexes, Jamsil Els, and Lake Palace increased by 10 million to 55 million KRW. The buying demand continued for low- to mid-priced apartments under 900 million KRW in areas like Nowon, Gangbuk, and Geumcheon, which also saw expanded price increases. In Nowon, Daedong in Wolgye-dong, Sangye Jugong 1 Complex (high-rise), Sangye Jugong 4 Complex, and Cheongsol in Hagye-dong rose by 10 million to 20 million KRW. In Gangbuk, Hanil U&I in Mia-dong, Hyundai in Suyu-dong, and Jugong 1 Complex in Beon-dong increased by 5 million to 15 million KRW.

New towns saw increases in Bundang (0.07%), Ilsan (0.06%), Sanbon (0.05%), Pyeongchon (0.03%), and Paju Unjeong (0.03%). In Bundang, areas such as Mujigae 2 Complex LG in Gumi-dong, Mujigae Cheonggu, Hansol LG in Jeongja-dong, and Hyoja Dong-A in Seohyeon-dong rose by 5 million to 10 million KRW. In Ilsan, Baekma 2 Complex Geukdong Samhwan in Madu-dong, Hugok 17 Complex Taeyoung in Ilsandong, and Gangseon 16 Complex Dongmoon in Juyeop-dong increased by 5 million to 10 million KRW.

In Gyeonggi and Incheon, the upward trend continued mainly in the southern Gyeonggi area. By region, Yongin (0.15%), Gunpo (0.14%), Namyangju (0.14%), Uiwang (0.14%), Seongnam (0.13%), Ansan (0.13%), and Anyang (0.12%) saw increases. In Yongin, Kumho Bestville 3 Complex 5 in Sanghyeon-dong, Byeoksan Blooming, Sinbong Xi 2 Complex in Sinbong-dong, and Dodam Village Lotte Castle in Jukjeon-dong rose by 5 million to 15 million KRW. In Gunpo, Imkwang Daega in Sanbon-dong, Ssangyong and Jugong 3 Complex in Dang-dong increased by 5 million to 10 million KRW. In Namyangju, Namyang i-Joheun Jip in Dasan-dong, Toegyewon Hillstate in Toegyewon-eup, and Gangbyeon Hyundai Hometown in Wabu-eup rose by 5 million to 20 million KRW.

In the Seoul metropolitan area, the jeonse (long-term deposit lease) market saw a shortage of jeonse properties, causing Seoul prices to rise by 0.09%, expanding from the previous week's 0.05%. Gyeonggi, Incheon, and new towns rose by 0.05% and 0.02%, respectively.

In Seoul's jeonse market, Songpa (0.28%), Gangdong (0.25%), Gwanak (0.19%), Gangnam (0.16%), Gangbuk (0.12%), and Nowon (0.11%) saw increases. In Songpa, the shortage of jeonse properties mainly pushed up prices in large apartment complexes. Garak-dong Songpa Heliocity, Jamsil-dong Jamsil Els, Jamsil Jugong 5 Complex, and Samsung Raemian in Songpa-dong rose by 5 million to 15 million KRW. In Gangdong, Woosung in Myeongil-dong, Gangil River Park 3 Complex in Gangil-dong, Godeok Raemian Hillstate in Godeok-dong, and Gangdong Xi in Gildong increased by 5 million to 15 million KRW. In Gwanak, Dongbu Centreville and Doosan in Bongcheon-dong rose by 10 million to 25 million KRW.

New towns saw increases in Bundang (0.04%), Sanbon (0.04%), Ilsan (0.02%), Pyeongchon (0.02%), and Gwanggyo (0.01%), while other new towns remained stable. In Bundang, areas such as Mokryeon Hanshin in Yatap-dong, Hyoja Samhwan in Seohyeon-dong, Mujigae Cheonggu in Gumi-dong, and Jangan Town Geonyeong 2 Complex in Bundang-dong rose by 5 million to 10 million KRW. In Sanbon, Maehwa Jugong 14 Complex in Sanbon-dong and Mokhwa Hanseong in Geumjeong-dong increased by about 5 million KRW.

In Gyeonggi and Incheon, Hanam (0.15%), Anyang (0.12%), Uiwang (0.12%), Yongin (0.09%), Guri (0.08%), Suwon (0.07%), and Goyang (0.06%) saw increases.

The June 17 real estate measures were announced, designating most areas in the metropolitan area as regulated zones and strengthening the obligation of actual residence to block gap investments. Lim Byung-chul, chief researcher at Real Estate 114, said, "In areas newly designated as regulated zones, some overheating signs are expected to subside, and buying sentiment is likely to show a short-term lull. The outer areas, where buying demand for low- to mid-priced apartments under 900 million KRW continued, are also expected to watch the market for a while as requirements such as moving in and disposal are strengthened when applying for mortgage loans." He added, "If overheating expands in the Gangnam area of Seoul, additional designation of land transaction permission zones is being considered, so a pause in the market may occur." However, concerns about the balloon effect remain. He said, "Since Gimpo and Paju, where the 2nd phase new towns are located, were excluded from this regulation zone, it cannot be ruled out that investment demand may shift to these areas."

The jeonse market in the metropolitan area is expected to continue rising due to a shortage of available properties. Chief researcher Lim explained, "An increase in subscription waiting demand expecting low pre-sale prices, conversion to monthly rent due to low interest rates, and a decrease in move-in volume may act as upward pressure on jeonse prices in the second half of the year." Along with this, if buying demand is significantly weakened due to this measure, the demand for home ownership may remain in jeonse, which could also be a factor of instability in the future jeonse market.

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