This Year, One in Three Apartments Priced Under 600 Million Won in Seoul Has Decreased

[Image source=Yonhap News]

[Asia Economy Reporter Kim Hyemin] This year alone, one out of every three mid-to-low-priced apartments in Seoul priced under 600 million KRW has disappeared.

According to the 'Status of Households with Apartments Priced Under 600 Million KRW by Seoul District' surveyed by Real Estate 114 on the 5th, the number of apartments priced under 600 million KRW, which was 259,785 households at the beginning of January, sharply decreased to 176,186 households by the end of last month. This means 83,600 households disappeared within six months, representing a decline of 32.2%.

The price point of 'under 600 million KRW' is the standard price to which policy loans such as the Bogeumjari Loan or preferential Loan-to-Value (LTV) ratios for mortgage loans for non-homeowners are applied.

As apartment prices in Seoul surged this year, the proportion of apartments priced under 600 million KRW has rapidly decreased. At the beginning of the year, these apartments accounted for 20.2% of all apartments in Seoul, but this dropped to 14.4% over six months. This contrasts with the total number of apartments in Seoul increasing from 1,220,279 households to 1,283,677 households during the same period.

The district with the largest decrease in low-priced apartments was Gwangjin-gu, where the number dropped from 829 households to 188 households, a decline rate of 77.3%. Eunpyeong-gu, Dongjak-gu, and Gangdong-gu also saw more than a 50% decrease in apartments priced under 600 million KRW. Among the 25 districts in Seoul, four districts?Dobong-gu, Geumcheon-gu, Jungnang-gu, and Nowon-gu?had more than half of their apartments priced under 600 million KRW at the beginning of the year, but by the end of last month, only Dobong-gu remained in this category.

With the easing of loan regulations for non-homeowners starting this month, the trend of decreasing apartments priced under 600 million KRW is expected to continue. The government has raised the LTV preferential rate for non-homeowners by up to 20 percentage points, and the loan limit for the Bogeumjari Loan applied to apartments priced under 600 million KRW has been expanded from 300 million KRW to 360 million KRW.

Lim Byungcheol, head of the research team at Real Estate 114, said, "Since loan regulations for non-homeowner real demand buyers have been eased starting this month, demand for mid-to-low-priced apartments in outer areas is expected to continue."

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