Despite Loan Restrictions and Expanded Pre-Subscription, Apartment Prices Rise in the Seoul Metropolitan Area... "Due to Lack of Listings"

Real Estate 114, Apartment Price Trends in the Seoul Metropolitan Area for the Last Week of August

[Asia Economy Reporter Kim Hyemin] Despite consecutive loan restrictions in the banking sector, the government's announcement to expand pre-sale subscriptions, and the Bank of Korea's base interest rate hikes, apartment prices in the Seoul metropolitan area continue to rise.

As the shortage of listings persists, transactions have decreased, but the trend of deals occurring at prices higher than market value continues. Areas with expectations for expanded transportation networks, such as Nowon, Gangseo, and Geumcheon in Seoul, as well as Suwon, Siheung, and Anyang in Gyeonggi Province, where mid-to-low priced apartments are concentrated, have driven the upward trend.

According to Real Estate 114 on the 28th, the apartment sale prices in Seoul for the last week of August rose by 0.11% compared to the previous week. Reconstruction apartments increased by 0.1%, and general apartments rose by 0.11%.

In Seoul, a seller's market continues mainly in areas with many mid-to-low priced apartments such as Nowon and Geumcheon. By region, Nowon-gu showed the highest increase at 0.26% compared to the previous week. This was followed by ▲Gangseo (0.23%) ▲Geumcheon (0.2%) ▲Gangnam (0.19%) ▲Guro (0.19%) ▲Gwangjin (0.16%) ▲Dongjak (0.16%) ▲Yongsan (0.16%).

New towns rose by 0.04% compared to the previous week. By region, the increases were ▲Pyeongchon (0.18%) ▲Ilsan (0.07%) ▲Jungdong (0.06%) ▲Wirye (0.06%). Gyeonggi and Incheon rose by 0.08% compared to the previous week, driven by transportation benefits such as GTX, development prospects, and regional price adjustments, leading the rise mainly in the southern Gyeonggi area. By region, the increases were ▲Suwon (0.19%) ▲Siheung (0.19%) ▲Anyang (0.18%) ▲Ansan (0.14%).

The jeonse (long-term lease) market is experiencing a shortage of listings, and as the summer vacation season ends, jeonse demand is gradually increasing. Seoul rose by 0.09%, Gyeonggi and Incheon by 0.06%, and new towns by 0.02%.

The jeonse market continues to face a shortage of listings, and with the end of the summer vacation season, jeonse demand is gradually increasing. Seoul's jeonse prices continued to rise due to the shortage of listings. The increases were ▲Gangseo (0.23%) ▲Nowon (0.23%) ▲Gangbuk (0.2%) ▲Geumcheon (0.19%) ▲Gwanak (0.18%) ▲Gangdong (0.17%). Gyeonggi and Incheon rose by 0.06%, and new towns by 0.02% compared to the previous week.

Lim Byungcheol, Senior Researcher at Real Estate 114, said, "With the banking sector's move to reduce loan limits, additional expansion of pre-sale subscription supply, and interest rate hikes, buying sentiment is expected to be somewhat subdued." However, he added, "Due to the supply shortage causing a supply-demand imbalance, jeonse difficulties, and election-related issues, the effect of the base interest rate hike may be limited." He also noted that the possibility of additional hikes within the year remains open, and the impact on the market may vary depending on the number and scale of the hikes.

Senior Researcher Lim continued, "The jeonse market is facing a continued shortage of listings, and with the full-scale autumn moving season approaching, supply-demand instability is intensifying." He added, "If the pre-sale subscription volume expands and more demand stays in jeonse to meet the conditions, the jeonse difficulties could worsen."

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