Due to the Jeonse shortage, two- and three-room units are also in high demand... Transaction volumes decreased and rents increased

Real Estate Platform Dabang's Analysis of the Non-Apartment Housing Market in November Last Year

[Image source=Yonhap News]

[Asia Economy Reporter Onyu Lim] Due to the apartment-driven Jeonse (long-term lease) shortage, a supply-demand imbalance is occurring in Seoul, where transactions of two- and three-room units (exclusive area 30~85㎡) are decreasing while prices are rising.

On the 7th, real estate platform Dabang analyzed actual transaction data from the Ministry of Land, Infrastructure and Transport and found that in November last year, the monthly Jeonse and monthly rental transactions for detached (multi-family) houses, multi-unit houses, and row houses totaled 14,983 cases, a 16.23% (2,902 cases) decrease compared to the previous month. This is the lowest monthly figure recorded in the past year.

In particular, the transaction volume of two- and three-room units decreased by more than 20%, showing a marked downward trend. The transaction volume for 30~45㎡ units was 4,164 cases, and for 45~60㎡ units was 2,782 cases, the lowest transaction volumes of the year.

Due to the apartment Jeonse shortage, demand for two- and three-room units increased, but as listings decreased, Jeonse prices rose somewhat. The Jeonse deposits for 30~45㎡ and 45~60㎡ units were 158.97 million KRW and 204.86 million KRW respectively, rising about 3% compared to the previous month.

On the other hand, unlike two- and three-room units, the one-room market, which is not affected by the apartment market, showed a different trend. Although the transaction volume of one-room Jeonse and monthly rentals decreased compared to the previous month, the decline was relatively small at 4.97%, and Jeonse prices actually fell by about 3.21%. This is believed to be due to decreased demand around university areas as non-face-to-face classes increased amid the spread of COVID-19.

A Dabang official said, “As demand for small apartments shifts to villas, tenants concerned about rising Jeonse prices appear to be extending their Jeonse contracts, causing this phenomenon.” He added, “In the one-room market, winter is the off-season, and with the prolonged COVID-19 situation, online university lectures are expected to continue into next year, making it difficult to recover.”

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