Apartment Prices in Gyeonggi and Incheon Leading Last Year's Housing Price Surge Fall for the First Time in 2 Years and 5 Months

[Asia Economy Reporter Kim Min-young] Apartment prices in the Seoul metropolitan area have turned to a downward trend for the first time in two and a half years. Gyeonggi-do and Incheon, which saw the highest apartment price increases nationwide last year, also shifted to a decline this week. However, there is an analysis that it is necessary to observe a little longer to determine whether the real estate market will enter a full-fledged downward phase.

According to the weekly apartment price trend from the Korea Real Estate Board on the 5th, apartment prices in the Seoul metropolitan area fell by 0.02% compared to the previous week. This is the first time in two years and six months since late July 2019 that apartment prices in the metropolitan area have turned downward. It is interpreted as an effect of transaction contraction caused by overlapping factors such as loan regulations, the presidential election, interest rate hikes, and the Lunar New Year holiday.

Gyeonggi-do and Incheon, where apartment prices rose the most last year, also fell by 0.03% and 0.04%, respectively, returning to a downward trend for the first time in two years and five months. These two regions recorded the first and second highest increase rates among the 17 cities and provinces nationwide last year, with apartment prices rising more than 20%. According to the Korea Real Estate Board, as of last year, apartment sale prices in Incheon surged by 22.56%, and in Gyeonggi-do by 20.76%.

Apartment prices in Seoul fell by 0.01% for two consecutive weeks compared to the previous week. Gangnam-gu and Seocho-gu showed a flat trend for the first time in one year and two months since November 2020. Considering that Songpa-gu has maintained a flat trend for two weeks, the upward trend in all three Gangnam districts has stopped. Among the 25 autonomous districts in Seoul, 19 declined and 6 remained flat.

The jeonse (long-term lease) market is also stable. Jeonse prices in Seoul fell by 0.02% compared to the previous week. This marks a shift to a downward trend for the first time in two years and eight months since June 2019. Including the Gangbuk area, Songpa-gu (-0.03%) declined for two consecutive weeks, and Gangnam-gu (-0.01%) also shifted to a downward trend.

However, some view it as premature to conclude that the market has entered a downward trend based solely on this week's figures. The survey period included the Lunar New Year holiday, and the market distortion phenomenon caused by a transaction cliff due to overlapping factors such as the presidential election variable and loan regulations is occurring. Since the market atmosphere may change depending on policy directions after the presidential election, there is also an analysis that the market should be observed after March.

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