‘Panic Buying’ Rush in ‘No·Do·Gang’... Real Estate Agencies Also Increased

Nowon and Gangbuk Districts See More New Openings Than Closures
Seoul's New Office Registrations This Year Down 20% Compared to Last Year

A licensed real estate agency in downtown Seoul.

[Asia Economy Reporter Ryu Tae-min] Despite the ongoing closures of real estate agencies in Seoul, the number of agencies in the 'No-Do-Gang (Nowon, Dobong, Gangbuk)' areas has actually increased. This appears to be due to a balloon effect caused by the government's stringent regulations and panic buying, which have driven up housing prices and boosted transactions in these areas.

On the 23rd, Asia Economy reviewed statistics by local districts in Seoul and found that 125 new certified real estate offices opened in Nowon-gu this year, a 50.6% increase from 83 last year. Meanwhile, closures in the district decreased by 8.5%, with 82 closures this year compared to 89 last year. In Gangbuk-gu, new openings numbered 89 this year, surpassing closures at 88, reversing last year's trend where 75 new offices opened versus 76 closures. However, in Dobong-gu, new openings were 56, fewer than the 64 closures this year.

This contrasts with the overall trend across Seoul. The total number of newly opened real estate agencies in Seoul this year was 3,551, down 20.8% from 4,290 last year. The Gangnam 3 districts also saw a clear decline in new openings: Gangnam-gu from 612 to 556, Seocho-gu from 295 to 282, and Songpa-gu from 350 to 268.

This trend seems to be driven by strong buyer demand in the outer Seoul areas where mid- to low-priced apartments are concentrated. Additionally, the implementation of the two lease laws?the rent ceiling system and the right to request contract renewal?has worsened the jeonse (key money deposit) shortage, prompting many tenants to shift from jeonse demand to purchase demand, which has energized transactions.

According to KB Real Estate's housing price trends, the average apartment sale price per 3.3㎡ in Nowon-gu was approximately 22.747 million KRW in January this year but rose 28.6% to 29.2545 million KRW by November.

This is the highest increase among Seoul's 25 districts this year. Gangbuk-gu also saw a 27.2% rise from 20.427 million KRW to 25.9941 million KRW during the same period, and Dobong-gu's prices increased 25% from 20.0211 million KRW to 25.0437 million KRW. Housing sales volume also increased. According to the Korea Real Estate Board, from the start of this year through October, housing sales were 10,369 in Nowon-gu, 6,744 in Dobong-gu, and 6,728 in Gangbuk-gu, representing a surge of 87% to 138% compared to the same period last year.

Professor Kwon Dae-jung of Myongji University's Department of Real Estate said, "Concentrated real estate demand in one area leads to rising housing and jeonse prices there, which is undesirable. More effective real estate policies are needed to resolve the jeonse shortage so that balance can return to the real estate market."

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