How far will the rise in housing prices triggered by Oh Se-hoon go... Seoul's increase expands again

Korea Real Estate Board May First Week Apartment Price Trends
Expectations for Regulation Relaxation... Seoul Apartment Price Increase Widens
Nowon-gu Sees Largest Rise in 2 Years 8 Months

Seoul Jeonse Prices Also Rise Sharply... Housing Price Instability Continues
Incheon Sales and Jeonse Prices Surge... Gyeonggi Siheung Also Jumps

Apartment complexes undergoing reconstruction viewed from the Lotte World Tower Observatory in Songpa-gu, Seoul [Image source=Yonhap News]

[Asia Economy Reporter Moon Jiwon] Since the inauguration of Seoul Mayor Oh Se-hoon, expectations for deregulation have grown mainly around major reconstruction complexes, leading to a further expansion in the rise of apartment prices in Seoul. In Nowon-gu, Seoul, considered one of the biggest beneficiaries of Mayor Oh's election, prices surged by 0.21% this week, marking the highest increase in about 2 years and 8 months.

According to the weekly apartment price trend survey for the first week of May released by the Korea Real Estate Board on the 6th, as of the 3rd, apartment prices in Seoul rose by 0.09%, an increase from the previous week's 0.08%.

Seoul's rise rate dropped to 0.05% in the first week of last month due to the government's 2·4 housing supply plan, but after Mayor Oh Se-hoon, who campaigned on deregulation, won the Seoul mayoral by-election on the 7th of the same month, the weekly increase has been expanding.

The Real Estate Board analyzed, "While the supply and demand situation is generally stable due to the confirmation of pre-subscription for the 3rd phase new towns, continuous housing supply plans, and strengthened tax burdens, areas with expectations of deregulation or some medium to large-sized units are seeing price increases."

In Seoul, Nowon-gu, which has major reconstruction complexes, saw a buying frenzy mainly in older buildings in Sanggye and Wolgye-dong, causing a sharp rise of 0.21%. This is the largest increase in about 2 years and 8 months since the third week of September 2018, when the rise rate was 0.24%.

Since Mayor Oh directly mentioned areas like Sanggye-dong in Nowon-gu during the Seoul mayoral election and expressed his determination to promote reconstruction, expectations for rising housing prices have increased. In particular, Seoul has designated other reconstruction complexes in areas such as Apgujeong-dong in Gangnam-gu and Mok-dong in Yangcheon-gu as land transaction permission zones, excluding Nowon-gu, which has added a balloon effect.

The Gangnam area, where major reconstruction complexes are concentrated, also saw an expansion in apartment price increases. Seocho-gu (0.15%) rose mainly in older complexes in Banpo-dong, Songpa-gu (0.15%) increased mainly in medium to large-sized units in Munjeong and Bangi-dong, and Gangnam-gu (0.14%) rose centered on complexes with reconstruction expectations such as Apgujeong and Gaepo-dong. Both Gangnam and Seocho-gu saw higher rise rates compared to the previous week.

Additionally, Yeongdeungpo-gu (0.15%) continued its upward trend mainly in older complexes in Yeouido-dong, and Yangcheon-gu (0.12%) also rose mainly in new town complexes in Mok-dong.

In Incheon, where housing prices have risen sharply due to various development benefits, apartment prices rose 0.55% this week, an increase from 0.51% the previous week. Yeonsu-gu (0.82%) saw significant increases mainly in Okryeon, Yeonsu, and Dongchun-dong, which have transportation benefits, while Seo-gu (0.60%), Michuhol-gu (0.57%), and Gyeyang-gu (0.49%) also saw notable rises.

In Gyeonggi-do, the apartment price rise rate slightly narrowed from 0.31% last week to 0.30% this week, but buying demand was concentrated mainly in key areas. Siheung, which is attracting the most attention nationwide due to many transportation benefits, surged 0.96%, and Gunpo (0.57%), Pyeongtaek (0.47%), and Dongducheon (0.40%) also continued their upward trends.

[Image source=Yonhap News]

The jeonse (long-term lease) market, which had been stabilizing, also saw a slight expansion in the rate of increase. The jeonse price rise rate for Seoul apartments increased from 0.02% last week to 0.03% this week. This is the first time in about six months since November last year (0.14% → 0.15%) that the rise rate in Seoul's jeonse prices has increased.

The Real Estate Board explained, "While showing stability due to seasonal off-peak periods, there was a slight increase mainly in complexes with good school districts and transportation environments or newly built complexes."

North of the Han River, Nowon-gu (0.10%) saw jeonse prices rise mainly in reconstruction complexes in Sanggye-dong, but Mapo-gu (0.00%) showed mixed trends and turned stable, while Jongno-gu (-0.02%) shifted to a decline as listing prices were adjusted downward.

South of the Han River, all four Gangnam districts saw an expansion in jeonse price increases: Songpa-gu (0.00 → 0.02%), Seocho-gu (0.00 → 0.01%), Gangdong-gu (0.00 → 0.01%), and Gangnam-gu (-0.01 → 0.00%). Outside the Gangnam 4 districts, Guro-gu (0.04%) rose mainly around stations in Sindorim and Gaebong-dong, while Yangcheon-gu (-0.04%) continued its decline due to the impact of new housing supply.

In Incheon, where the rise in apartment prices was large, the jeonse price rise rate also expanded from 0.33% to 0.40%. Seo-gu (0.57%) saw significant increases mainly around station areas in Gajeong-dong with good residential environments and in Bullo and Majon-dong, which have good commuting access to Seoul.

In Gyeonggi-do, the jeonse price rise rate slightly narrowed from 0.12% to 0.11%. Jeonse prices in Siheung-si (0.54%) rose significantly, and Osan-si (0.50%), Danwon-gu in Ansan (0.37%), and Dongducheon-si (0.36%) also showed clear upward trends. However, Gwacheon-si (-0.15%) continued its decline due to the impact of new housing supply.

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