Seoul Apartment Prices Keep Rising... Reconstruction-Driven Uptrend Continues

Real Estate 114, Seoul Apartment Price Trends for the First Week of June

[Asia Economy Reporter Kim Hyemin] Despite Seoul City's priority policy on redevelopment, the Seoul apartment market has continued to experience a reconstruction-driven uptrend. Seoul apartment sale prices keep rising, and the rate of increase has expanded again. The upward trend is particularly notable in areas with many mid-to-low-priced apartments such as Nowon, Geumcheon, and Gangbuk, as well as major reconstruction complexes in Gangnam, Gangdong, and Songpa.

According to Real Estate 114 on the 5th, this week Seoul apartment sale prices rose by 0.12% compared to the previous week. While general apartments increased by 0.11%, reconstruction apartments rose by as much as 0.18%. The monthly change rate for Seoul apartment sale prices in May was 0.4%, the largest increase compared to the same period over the past four years.

Seoul saw all 25 autonomous districts rise for five consecutive weeks. By region, the increases were ▲Nowon (0.27%) ▲Geumcheon (0.22%) ▲Gangnam (0.18%) ▲Gangdong (0.18%) ▲Gangbuk (0.18%) ▲Mapo (0.17%) in order.

New towns rose by 0.07% compared to the previous week. Pyeongchon increased by 0.2%, showing the largest rise, followed by Jungdong (0.12%), Ilsan (0.11%), and Sanbon (0.1%). Gyeonggi and Incheon rose by 0.08% compared to the previous week, mainly in areas with good transportation conditions and clusters of mid-to-low-priced small apartments. The order was ▲Suwon (0.19%) ▲Incheon (0.17%) ▲Bucheon (0.16%) ▲Siheung (0.12%).

Seoul’s jeonse (long-term lease) market rose by 0.08% compared to the previous week, with the rate of increase slightly expanding. Although moving season demand decreased, prices rose mainly in areas with relatively scarce jeonse listings and where reconstruction relocation demand exists. The order was ▲Dongjak (0.16%) ▲Gwangjin (0.15%) ▲Seocho (0.15%) ▲Gangbuk (0.14%) ▲Seongbuk (0.14%).

New towns and Gyeonggi-Incheon rose by 0.02% and 0.04%, respectively, compared to the previous week.

Lim Byungcheol, Senior Researcher at Real Estate 114, said, "The capital gains tax surcharge, which had been postponed for six months, was implemented from the 1st, and from July, the LTV preferential rate for the homeless and actual buyers will be expanded, which is expected to have a considerable impact on the real estate market in the second half of the year." He added, "Due to the comprehensive real estate tax and capital gains tax surcharges, the preference for a single solid property in specific areas may become more pronounced, and the easing of loan conditions for the homeless may lead to actual demand continuing in areas with clusters of mid-to-low-priced apartments."

Regarding the jeonse market, he diagnosed, "With a decrease in move-in volume and the ongoing trend of jeonse turning into monthly rent, concerns about a decrease in listings are growing. Even the relatively stable apartment jeonse prices in the metropolitan area are showing slight increases." He added, "Large-scale relocations in some reconstruction complexes are scheduled for the second half of the year, so despite the off-season, the jeonse market is expected to maintain a firm upward trend due to concerns about jeonse supply shortages."

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