"Apartment Prices Too High to Buy"... Seoul Villa Transactions Surpass Apartments for 6 Consecutive Months

Demand for Homeownership Shifts to Villas Due to Housing Price Burden
Last Month, 4,359 Multi-family and Row House Transactions in Seoul... 1.5 Times That of Apartments
Real Demand and Long-term Investment Concentrate in Affordable Seoul Outskirts like Eunpyeong, Gangseo, and Dobong Districts

[Asia Economy Reporter Ryu Tae-min] The volume of transactions for multi-family and row houses in the Seoul area has surpassed apartment transaction volumes for six consecutive months. As housing prices have soared since last year, increasing the financial burden, demand for 'owning a home' has shifted to relatively affordable villas, leading to a continued reversal in transaction volumes.

According to the Seoul Real Estate Information Plaza on the 13th, the number of multi-family and row house sales transactions in Seoul last month (based on the reporting date) totaled 4,359 cases. This is more than 1.5 times the apartment sales transactions, which stood at 2,835 cases. Although there are still over two weeks left for reporting last month's sales transactions, the large gap in transaction volumes suggests that the trend is unlikely to change.

Typically, apartment transaction volumes are about 1.5 to 2 times higher than those of multi-family and row houses. Based on last year's data, total apartment sales transactions were 81,183, approximately 40% higher than multi-family and row houses at 58,862. However, this year, from January through last month, the reversal in transaction volumes has continued for six consecutive months. In January, multi-family and row house transactions were 5,839, slightly surpassing apartment transactions at 5,789. In February, they increased by 15.3% to 4,458 compared to apartments at 3,886, and in March, the gap widened to about 35.5% with 5,130 versus 3,787 apartment transactions. Particularly in April, villa transactions reached 5,702 compared to 3,656 apartments, a 56.5% difference, which narrowed to 24.8% (5,969 vs. 4,783) in May, then widened again to 53.8% last month.

Experts analyze that the soaring apartment prices since last year have increased the financial burden, influencing this trend. With tightened loan regulations and significant price increases, buyers have turned their attention to alternative markets where prices are relatively affordable and the gap between sale and jeonse (long-term lease) prices is smaller. Especially as apartment prices in most areas have risen simultaneously and listings have decreased, even existing residents find it difficult to move to other complexes, leading to a contraction in transactions.

Expectations for revitalizing redevelopment in aging residential areas are also cited as a cause. Song Seung-hyun, head of Urban and Economic Research, said, "With recent tightening of regulations on reconstruction, investment demand that was concentrated in reconstruction complexes such as Gangnam appears to have shifted to redevelopment areas densely populated with multi-family and row houses."

Multi-family and row house transactions have been active in outer districts. Last month, the district with the highest volume of multi-family and row house transactions was Eunpyeong-gu (533 cases), followed by Gangseo-gu (400 cases), Dobong-gu (317 cases), and Gangbuk-gu (316 cases), where transactions were also active.

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