Regional Metropolitan Housing Prices Soar... "Prices Never Seen Before"

Complexes with 200-300 Million KRW Increase in Less Than a Year
Rise in Out-of-Area Investments Expands Growth Rates Across Provinces
Development Benefits Like Transportation Ahead of Next Year's Presidential Election
Concerns Over Impact on Genuine Buyers if Non-Residents Withdraw

Despite consecutive loan restrictions and interest rate hikes in the financial sector, apartment prices in the Seoul metropolitan area are hardly declining, while the rate of increase in apartment prices in regional metropolitan cities is also accelerating. In some areas such as Ulsan and Daejeon, actual transaction prices and asking prices have surged simultaneously in a short period, prompting frontline real estate agencies to respond that these are "house prices never seen before." It is interpreted that speculative investments aiming for capital gains are spreading from the overheated apartment market in Seoul and other metropolitan areas to the provinces, driving prices up.

According to the weekly apartment price trend survey time series data released by the Korea Real Estate Board on the 3rd, apartment prices in regional areas, including major metropolitan cities, have shown an increased rate of rise compared to the previous week. This survey was conducted for the first time after the Bank of Korea's surprise interest rate hike on the 26th of last month, the first in 15 months. While Seoul saw a slight decrease in the rate of increase due to the interest rate hike and loan restrictions by commercial banks, regional areas rather showed an expansion in the rate of increase.

The rise was particularly evident in major metropolitan cities in the provinces. Ulsan rose by 0.30% this week, doubling the previous week's increase of 0.15%. Especially, Ulju-gun rose by 0.56% in one week, showing the highest increase this year. As the Ulsan Station complex transfer center recently began construction and other station area developments continue, nearby apartment prices have risen rapidly. In fact, an 84㎡ apartment in Ulsan Munsu Sandershap in Ulju-gun was traded at 630 million KRW on the 31st of last month, setting a new record price.

Apartment prices are soaring not only in metropolitan cities such as Daejeon, Busan, and Gwangju but also in Gyeongbuk, Gyeongnam, Gangwon, and Jeju. The five major metropolitan cities saw their apartment price increase rates expand from 0.19% to 0.22% this week, and among the eight provinces, only Jeonnam and Jeonbuk showed a decrease in the rate of increase.

Although the government has raised interest rates, the market's investment sentiment remains resilient due to high expectations of rising house prices. Some analysts suggest that various development pledges related to roads, railways, and other infrastructure ahead of next year's presidential election are also influencing this trend.

Kwon Il, head of the research team at Real Estate Info, said, "There are still many investors venturing out to regional areas, which are relatively less regulated and cheaper, as well as the metropolitan area. High-priced apartments that were previously unseen are now appearing one after another."

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