Ahead of Supply Measures Announcement... Seoul Apartment Prices Stir Again

Real Estate 114, January Fourth Week Seoul Metropolitan Area Apartment Price Trends
Full-Scale Promotion of Deregulation in Maintenance Projects... Impact of Reconstruction Revitalization Pledges

[Asia Economy Reporter Kim Hyemin] After seeming to take a breather, Seoul apartment prices have expanded their rate of increase again ahead of the government's announcement of supply measures. It is analyzed that the government's public redevelopment and public reconstruction plans, along with the reconstruction revitalization pledges of the Seoul mayoral candidates from both major parties, are being perceived in the market as signals of regulatory easing.

According to Real Estate 114 on the 30th, the apartment sale prices in Seoul in the fourth week of January rose by 0.15% compared to the previous week, marking the highest increase in the past year. General apartments increased by 0.13% from the previous week, slightly expanding the rise, while reconstruction complexes saw a 0.28% price increase. This is the highest rate of increase since the end of December last year (0.29%).

Seoul apartment sale prices continue to be led by relatively less price-burdened areas such as Gwanak, Nowon, and Dobong. The increases were in the order of ▲Gwanak (0.33%) ▲Gwangjin (0.29%) ▲Nowon (0.28%) ▲Dobong (0.28%) ▲Gangdong (0.25%) ▲Seongbuk (0.23%) ▲Jung-gu (0.22%) ▲Guro (0.2%). The reconstruction price rise was led by Apgujeong-dong in Gangnam-gu and Jamsil-dong in Songpa-gu.

Apartment sale prices in new towns rose by 0.15% compared to the previous week. Following last week, Ilsan's apartment prices continued to increase their rise. By region, the order was ▲Ilsan (0.35%) ▲Pyeongchon (0.25%) ▲Wirye (0.23%) ▲Pangyo (0.16%) ▲Jungdong (0.14%) ▲Paju Unjeong (0.13%) ▲Bundang (0.12%). Real Estate 114 explained, "Ilsan has steady demand due to the combined effects of the GTX (Great Train Express) transportation benefits and relative undervaluation issues."

Gyeonggi and Incheon also showed high rates of increase in areas expected to benefit from GTX, such as Goyang (0.3%), Uiwang (0.3%), Uijeongbu (0.29%), and Paju (0.28%).

The jeonse (long-term lease) market in Seoul rose by 0.18% compared to the previous week, but the upward trend has slowed for three consecutive weeks. However, centered around the Geumgwan district (Geumcheon, Gwanak, Guro), real demand inflow continued, and these areas maintained price increases comparable to the sales market. The order was ▲Gwanak (0.36%) ▲Guro (0.35%) ▲Geumcheon (0.34%) ▲Gangnam (0.3%).

Jeonse prices in new towns rose by 0.14% compared to the previous week. Wirye was the highest at 0.21%, followed by Ilsan (0.18%), Bundang (0.17%), and Dongtan (0.16%). In Gyeonggi and Incheon, Uijeongbu rose the most at 0.27%.

There are forecasts that Seoul apartment market prices will change depending on the direction of the supply measures the government will announce before the Lunar New Year holiday. There is also a possibility that the market could fluctuate depending on the election outcomes of Seoul mayoral candidates from both major parties, who have promised to ease reconstruction regulations.

Yoon Jihae, chief researcher at Real Estate 114, said, "The government's development plans for low-rise residential areas near Seoul stations and semi-industrial areas are expected to play a positive role in easing the anxiety of real demand groups in the mid to long term, but in the short term, market volatility is a concern. Both Seoul mayoral candidates have announced supply policies through easing redevelopment regulations, and the price trends of reconstruction complexes are showing an unusual atmosphere."

Chief researcher Yoon added, "If the expectation of regulatory easing and the possibility of large-scale development coincide with transportation benefits and election issues, along with strong jeonse prices, the number of non-homeowning real demand groups shifting to purchase is expected to increase further."

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