Housing Prices Unyielding Despite Reconstruction 'Speed Control'... "Listings May Become Even Scarcer"

[Image source=Yonhap News]

[Asia Economy Reporter Kim Hyemin] Although Seoul City has started to slow down the pace of apartment reconstruction, the price increase trend has not been curbed. With available properties for sale scarce and the possibility of a further tightening of listings after the implementation of the heavy capital gains tax on multiple homeowners next month, the rate of increase could become even greater.

According to Real Estate 114 on the 23rd, the apartment sale prices in Seoul in the third week of May rose by 0.11% compared to the previous week. While the rate of increase was maintained, it still recorded a high growth rate compared to the 0.05% increase seen in early April. The cumulative increase for this month reached 0.32%.

The overheated Seoul real estate market this year was driven by expectations of reconstruction in the Gangnam area. However, as Seoul City repeatedly expressed concerns about the rising reconstruction prices and adjusted the pace, the rate of increase appears to have slowed. The sale prices of reconstruction apartments rose by 0.11% compared to the previous week, but the rate of increase fell by 0.09 percentage points.

However, the price matching trend centered on the outskirts of Seoul continues. In large established complexes in Gwanak, Nowon, and Guro, occasional buying demand has raised the average rate of increase. In particular, the upward trend remains unbroken in complexes that are relatively low-priced yet aged, with high reconstruction potential. In the third week of May, apartment sale prices in Seoul rose in the order of Gwanak (0.35%), Nowon (0.29%), and Guro (0.25%).

In Gwanak-gu, large complexes such as Sillim Hyundai in Sillim-dong and Gwanak Hyundai in Bongcheon-dong increased by 10 to 15 million KRW. In Nowon, mid-sized units mainly in Byeoksan in Sanggye-dong, Sanggye Jugong Complex 3, and Miryung, Miseong, Samho Complex 3 in Wolgye-dong rose by 10 to 50 million KRW. In Mapo, reconstruction complexes such as Seongsan Siyeong in Seongsan-dong and Woosung in Dowa-dong also increased by 10 to 50 million KRW.

The Seoul apartment sales market is expected to see a reduction in available listings in the future. Real Estate 114 stated, "With an increasing number of land transaction permission zones designated and consecutive approvals for association establishments in major complexes, available properties for sale are becoming scarce," adding, "Moreover, with the heavy capital gains tax on multiple homeowners set to be implemented next month, the overall market may experience a deepening of the listing freeze phenomenon."

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