Nationwide Apartment 'Actual Transaction Prices' Decline... Seoul Falls for the First Time in 1 Year and 7 Months

Last November Saw a Decline in the Actual Transaction Price Index
Reflecting Recent Market Conditions... Downward Trend Intensifies
December Apartment Price Increase Also Significantly Slows Down

[Image source=Yonhap News]

The nationwide apartment actual transaction price index turned downward in November last year. This is interpreted as a result of a combination of loan regulations, interest rate hikes, and the spread of perceptions that housing prices have peaked. There are observations that a full-scale decline in housing prices may begin going forward.

According to the actual transaction price index for multi-family housing in November last year, announced by the Korea Real Estate Board on the 14th, the Seoul apartment actual transaction price index was 179.9, down 0.79% from the previous month.

Incheon rose 0.49% compared to the previous month, but Gyeonggi Province fell 0.11%, causing the overall metropolitan area actual transaction price index for November to drop 0.27%. The decline in Seoul apartment actual transaction price index is the first in 19 months since April 2020, and Gyeonggi Province's decline is the first in 2 years and 6 months since May 2019.

The actual transaction price index is indexed by comparing the actual transaction prices with previous transaction prices, unlike price trend surveys centered on market prices. Therefore, it is evaluated as the most accurate reflection of recent market conditions.

The actual transaction price index in provincial areas also saw an increase in regions with declines. As of November, the actual transaction price indices for Sejong (-4.11%), Daejeon (-0.82%), Busan (-0.51%), Ulsan (-0.09%), and Chungbuk (-0.05%) turned downward compared to the previous month, and Daegu (-1.35%) continued its decline for the second consecutive month.

[Image source=Yonhap News]

The monthly increase rate of apartment prices is also shrinking.

According to the nationwide housing price trend survey by the Korea Real Estate Board, the comprehensive housing price (including apartments, row houses, and detached houses) nationwide rose 0.29% in December last year, narrowing the increase compared to the previous month (0.63%).

The apartment price increase rate in Seoul sharply slowed from 0.60% in November last year to 0.25% in December. Major Gangnam area districts such as Seocho-gu (0.55%), Gangnam-gu (0.44%), and Songpa-gu (0.34%) rose due to some record-high transactions like reconstruction, but the increase rate shrank as some urgent sale listings appeared.

Gyeonggi Province and Incheon, where apartment prices surged by 1.67% and 1.90% respectively in November last year, rose only 0.36% and 0.52% respectively in December, dropping the increase rate to less than half.

In particular, apartment prices in Sejong City fell by a whopping 2.10% in December alone, expanding the decline compared to the previous month (-0.82%). Apartment prices in Daegu also fell 0.17% in December, increasing the decline compared to November (-0.07%).

The apartment jeonse (long-term lease) price increase rates slowed from 0.47% to 0.25% in Seoul, from 0.79% to 0.37% in Incheon, and from 0.70% to 0.25% in Gyeonggi Province. Daegu apartment jeonse prices turned downward, falling 0.06% in December.

The nationwide comprehensive housing monthly rent price also rose 0.22%, narrowing the increase compared to the previous month (0.29%).

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