Polarization of Apartment Prices by Area in the Seoul Metropolitan Area... Small Units 'Decline' · Large Units 'Stable'

Loan Regulations Slow Buying Demand Among 2030 Generation... Small Complexes on Outskirts Stall
Large Apartments in Gangnam Area Remain Popular... Strong Preference for 'Smart One Home' Continues

Apartment buildings in the Seoul area (Photo by Yonhap News)

[Asia Economy Reporter Ryu Tae-min] Recently, as housing prices show signs of downward stabilization, a clear polarization in prices according to apartment size is emerging in the Seoul metropolitan area. Small-sized apartments with limited floor space, mainly in low-priced complexes in suburban areas, are experiencing a pronounced decline, whereas large-sized complexes, especially in the Gangnam area, are either seeing slight price increases or maintaining their value. This is interpreted as a result of increased financial burden on the '2030 Young Chul-jok'?primarily buyers of small apartments?due to loan regulations and interest rate hikes.

According to the weekly apartment price trend survey by the Korea Real Estate Board on February 14, in the first week of February (as of the 7th), the sale price of small apartments (exclusive area of 60㎡ or less) in Seoul fell by 0.03% compared to the previous week, marking the highest decline among all size categories. In contrast, large apartments (over 102㎡) showed no change (0.00%) compared to the previous week, maintaining a stable trend.

This trend was similar in the monthly statistics from last month. Small apartments dropped by 0.12% over the month, while large apartments rose by 0.10%, showing opposite movements. During the same period, medium-small apartments (over 60㎡ to 85㎡ or less) increased by 0.07%, and medium apartments (over 85㎡ to 102㎡ or less) rose by 0.17%.

Loan Regulations Cause 2030 Young Chul-jok to Hesitate in Buying

This phenomenon is attributed to the slowdown in purchasing by the 2030 'Young Chul-jok' crowd, who had concentrated on affordable small apartments. In fact, the polarization by size was particularly noticeable in the Gangbuk area, where demand from the younger generation was high. In the northeastern region, including Nowon, Dobong, and Gangbuk districts, small apartment prices fell by 0.09% in the first week of February. Compared to the entire last month, small apartments dropped 0.35%, contrasting with large apartments that showed a slight increase of 0.02%, indicating a stable trend.

In other metropolitan areas, demand for mid-to-low priced complexes has decreased, widening the gap. In Incheon, small apartment sale prices have fallen for two consecutive weeks, dropping by 0.17%. Meanwhile, large apartments in the same period rose by 0.16%, showing an opposite trend. In Gyeonggi Province, small apartments declined by 0.08%, whereas large apartments increased by 0.05%.

Conversely, in the Gangnam area of Seoul, where demand for high-priced housing is concentrated, high growth rates were observed regardless of size. Large apartments in the southeastern region, which includes the so-called 'Gangnam 4 districts (Gangnam, Seocho, Songpa, Gangdong),' rose by 0.20% last month. Small apartments in the same area also increased by 0.13% during the period.

Seo Jin-hyung, president of the Korea Real Estate Society and professor at Gyeongin Women's University, explained, "Due to recent tightening of loan regulations and consecutive interest rate hikes, the younger generation, who rely heavily on loans, are feeling financial pressure, leading to decreased demand for mid-to-low priced complexes. On the other hand, as the comprehensive real estate tax has been strengthened, the burden of owning multiple homes has increased, intensifying the preference for a 'smart single property,' which explains why large complexes centered in Gangnam remain resilient."

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