Seoul Housing Prices Rise 80 Million Won in First Half of Year... Highest in 12 Years

Despite Changes in Government Housing Policy 'Supply'
Market Buying Sentiment Remains Strong
High Asking Prices and Record Prices in Every Transaction Due to Shortage of Listings

[Asia Economy Reporter Kim Hyemin] The average sale price of apartments in Seoul rose by more than 80 million KRW in the first half of the year alone. Although the government has consistently signaled increased supply since the beginning of the year, it appears that it has not been able to dampen buyers' sentiment in the market.

According to the 'Monthly Housing Price Trend Time Series Statistics' by KB Kookmin Bank's Live Real Estate on the 1st, the average sale price of apartments in Seoul increased by an average of 81.75 million KRW from January to June this year. The average house price, which was 1,061.08 million KRW in January, jumped to 1,142.83 million KRW in six months. This is the highest level since KB Kookmin Bank started publishing related statistics in December 2008.

This figure is also significantly higher compared to the first half of last year. At that time, the average sale price of apartments in Seoul rose by 55.12 million KRW from 869.97 million KRW to 925.09 million KRW.

Looking at the time series statistics, the increase in apartment sale prices in Seoul during the first half of the year did not exceed 20 million KRW until 2017. In 2012 and 2013, the average house price even fell for two consecutive years. However, from 2014, house prices steadily rose, and in 2018, they increased by 55.57 million KRW in the first half alone. After a decline in 2019, prices rose by 55.12 million KRW last year and surged to 81.75 million KRW this year.

The rise in house prices in the first half of this year seems to be a continuation of the upward trend from the second half of last year. Although the government introduced changes to housing policies this year, including a supply plan announced in February, buyers' sentiment in the market has actually grown stronger. Kim Hakryeol, head of the Smart Tube Real Estate Research Institute, said, "There are no listings, but there is a lot of waiting demand. Policies to resolve this need to be introduced, but the government keeps implementing policies that reduce listings, such as heavy capital gains tax on multiple homeowners and stricter residency requirements."

With limited listings, homeowners raising their asking prices has also contributed to record-high transaction prices. A representative from a real estate agency in Gangbuk-gu said, "The atmosphere is to list houses at least 10 to 20 million KRW higher than actual transaction prices," adding, "Because asking prices are high, even if prices are adjusted during the contract process, it is not uncommon to break record prices." This indicates that the market still favors sellers.

By district, Seocho-gu, where jeonse prices have recently soared vertically, showed the largest increase in sale prices. In the first half of this year, the average sale price of apartments in Seocho-gu rose by about 1.46 million KRW per square meter. Converted to the 'national average size' of 84㎡ exclusive area, this means an increase of about 122.3 million KRW in the first half alone. Areas with relatively lower prices or accompanied by redevelopment issues, such as Dobong (1.22 million KRW per ㎡), Nowon-gu (1.21 million KRW), and Yangcheon-gu (1.20 million KRW), also showed high growth rates.

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