Housing Market Frozen... Seoul Buyer Sentiment Changes from 'Rising' to 'Stable' After 1 Year and 8 Months

The number of autonomous districts in Seoul where the average apartment sale price exceeds 50 million KRW per 3.3㎡ has more than doubled in one year. As of November last year, only Gangnam-gu, Seocho-gu, and Songpa-gu among the 25 autonomous districts in Seoul had average apartment sale prices exceeding 50 million KRW per 3.3㎡, but last month, Yongsan-gu, Seongdong-gu, Mapo-gu, and Gwangjin-gu were added, making a total of seven districts. The photo shows the view of Seoul apartments from 63 Square. Photo by Kim Hyunmin kimhyun81@

As perceptions of peak housing prices spread and interest rate hikes and loan regulations overlap, housing transaction sentiment nationwide is rapidly shrinking. The decline in buying sentiment is particularly significant in Sejong, Daegu, and Seoul.

According to the results of the "December 2021 Real Estate Market Consumer Sentiment Survey" released on the 17th by the Korea Research Institute for Human Settlements' Real Estate Market Research Center, Seoul's housing market consumer sentiment index in December last year was 108.1, down 10.7 points from the previous month (118.8).

In Seoul, based on the Korea Research Institute for Human Settlements' survey criteria, the market shifted from a rising phase to a stable phase for the first time in 1 year and 8 months since April 2020 (105.0). The Korea Research Institute for Human Settlements classifies the real estate market situation into three phases using the consumer sentiment index: rising (115 or above), stable (95 to less than 115), and declining (below 95).

Gyeonggi Province fell from 119.5 in November last year to 109.1 in December, and Incheon dropped from 115.6 to 109.6. Both Gyeonggi Province and Incheon declined for four consecutive months, shifting from a rising phase to a declining phase. The entire metropolitan area decreased from 118.8 to 108.8, marking the start of a stable phase. In the provinces, the index fell from 120.1 to 110.3 during this period, moving from a rising to a stable phase.

By region, the housing market consumer sentiment index dropped significantly in Sejong (-12.0 points), Daegu (-11.1 points), and Seoul (-9.8 points).

The jeonse (long-term lease) market, which saw a sharp price surge last year, is also gradually stabilizing. Seoul's jeonse market consumer sentiment index rose to 121.4 in September last year but fell to 104.9 in November and further to 96.2 in December, approaching a declining phase.

Gyeonggi Province also recorded 97.7 in December last year after four consecutive months of decline. Incheon similarly declined for three consecutive months, from 111.0 in October to 103.6 in November and 100.3 in December. The jeonse market consumer sentiment index dropped significantly compared to the previous month in Daegu (-11.2 points), Seoul (-8.7 points), and Chungnam (-7.4 points).

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