Seoul Jeonse Price Increase Expands for 3 Consecutive Weeks... Concerns Over Jeonse Crisis in Seocho-gu

Korea Real Estate Board June First Week Apartment Price Trends
Seoul Jeonse Prices Rise 0.08%, Increase in Growth Rate
Seocho-gu Surges Due to Relocation Demand from Redevelopment Projects
Concerns Over Jeonse Crisis Due to Insufficient Short-Term Supply
Seoul Apartment Prices Up 0.11%, Maintaining Upward Trend

View of an apartment complex from Namsan, Seoul

[Asia Economy Reporter Moon Jiwon] The increase in Seoul apartment jeonse prices has expanded for three consecutive weeks. In Seoul, Seocho-gu saw a sharp rise in jeonse prices as the relocation of large-scale reconstruction complexes began in earnest. There are concerns that the jeonse shortage could worsen in the second half of the year, as there are no immediate plans to expand apartment housing supply in Seoul.

According to the weekly apartment price trend for the first week of June announced by the Korea Real Estate Board on the 10th, as of the 7th, Seoul's apartment jeonse prices rose by 0.08%, an increase from the previous week's 0.06%. This week's rise is the highest in about four months since the third week of February.

Regarding Seoul's jeonse market, it had been gradually stabilizing since the end of last year, with the growth rate dropping to 0.02% by the end of April, but it has been increasing again since then. The Real Estate Board explained, "Although Seoul apartment jeonse prices have generally stabilized recently due to fatigue from rapid price hikes and the seasonal off-season, the overall increase in Seoul expanded compared to last week due to relocation demand from redevelopment projects."

In fact, Seocho-gu, where there is relocation demand from redevelopment projects, surged by 0.39% this week. Starting from June 1, relocations began sequentially from Banpo Jugong Complex 1 District 1, 2, and 4 blocks (2,120 households), followed by Sinbanpo 18th Complex (182 households), and Banpo Jugong Complex 1 District 3 block (1,490 households). By the second half of the year, relocation demand within Seocho-gu will reach about 5,000 households. Seocho-gu has been increasing its jeonse price rise for six consecutive weeks (0.00%→0.01%→0.04%→0.07%→0.16%→0.26%→0.39%).

Besides this, jeonse prices are also rising in Songpa-gu (0.15%), Gangdong-gu (0.10%), Nowon-gu (0.09%), and Seongdong-gu (0.09%). Dongjak-gu (0.13%) also saw jeonse price increases mainly in Noryangjin and Heukseok-dong, influenced by redevelopment relocation. However, Yangcheon (0.00%) and Geumcheon-gu (0.00%) maintained a stable trend as jeonse listings accumulated mainly in older buildings.

Incheon and Gyeonggi-do also saw an expansion in jeonse price increases this week. In Incheon (0.29%→0.36%), jeonse demand is increasing mainly in Yeonsu-gu (0.58%), Bupyeong-gu (0.42%), and Gyeyang-gu (0.39%). In Gyeonggi-do (0.14%→0.17%), Siheung-si (0.57%) saw jeonse prices rise mainly in Baegot New Town, which is perceived as relatively affordable. Additionally, Pyeongtaek-si (0.56%) rose mainly near Jije Station, and Dongducheon-si (0.45%) increased mainly around Jihaeng and Saengyeon-dong.

Apartment complexes in the Gangnam-gu area as seen from Daemosan Observatory in Seoul [Image source=Yonhap News]

Seoul apartment prices rose by 0.11%, the same as the previous week. After June 1, the base date for property tax, listings have decreased, and the upward trend continues. Nowon-gu (0.20%) and Dobong-gu (0.16%), where expectations for easing reconstruction regulations are high, saw significant increases mainly in mid-to-low price and station-area apartments. The Gangnam 3 districts?Seocho-gu (0.18%), Songpa-gu (0.16%), and Gangnam-gu (0.16%)?also maintained their upward trend.

In Gyeonggi-do, apartment prices rose by 0.39% this week, an increase from 0.36% last week. Siheung-si (0.96%) saw a sharp rise in apartment prices mainly in Janghyeon District and the mid-to-low price areas of Hajung and Hasang-dong, which have good transportation conditions. Other areas such as Anyang Dongan-gu (0.94%), Ansan-si (0.76%), and Pyeongtaek-si (0.74%) also attracted concentrated buying due to expectations of transportation improvements.

On the other hand, Sejong City showed a sluggish trend in both sales and jeonse. Sales shifted from stable last week to a decline of -0.04% this week. This is due to accumulated listings and falling asking prices in areas such as Goun and Dajeong-dong within the Happy City. Jeonse prices also fell by 0.09% this week, a larger decline compared to last week's -0.08%. The Real Estate Board explained, "The decline continued due to the seasonal off-season and the impact of new housing supply."

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