Seoul and Surrounding Capital Area See Reduced Increase in January 'Sale, Jeonse, and Monthly Rent' Prices

Apartment complex in Seoul area (Photo by Yonhap News)

[Asia Economy Reporter Ryu Tae-min] Last month, the rate of increase in housing sale, jeonse (long-term deposit lease), and monthly rent prices in Seoul and the metropolitan area all narrowed. Although some areas such as the Gangnam district still showed rising rates, most regions experienced a slowdown in the upward trend due to decreased transactions. This is attributed to the sharp decline in buying demand caused by interest rate hikes and strengthened loan regulations.

According to the nationwide housing price trend announced by the Korea Real Estate Board on the 15th, the comprehensive nationwide housing sale price last month rose by 0.10%, narrowing from the previous month’s 0.29%. The metropolitan area (0.33%→0.06%), Seoul (0.26%→0.04%), and provinces (0.25%→0.14%) all showed similar patterns. However, Sejong fell by 0.78%, reducing the decline compared to the previous month (-1.74%).

In Seoul, the Gangnam area, where high-priced complexes are concentrated, showed a high rate of increase. Seocho-gu (0.12%) rose mainly in reconstruction complexes with expectations for redevelopment projects, Songpa-gu (0.09%) mainly in Jamsil-dong, and Gangnam-gu (0.07%) mainly in some medium-to-large-sized units. Yongsan-gu (0.03%), with expectations for remodeling and redevelopment projects, saw a slight increase, but areas such as Nowon (-0.08%), Eunpyeong (-0.05%), and Seongbuk-gu (-0.04%) turned downward due to inventory accumulation and urgent sales mainly in mid-to-low-priced properties.

Gyeonggi-do (0.05%) rose mainly in areas with favorable residential environments, and Incheon (0.12%) increased mainly in areas with expected development benefits. However, due to increased market uncertainty caused by concerns over global monetary tightening, buying sentiment and transaction activity continued to weaken, significantly narrowing the overall rise in the metropolitan area.

The nationwide comprehensive housing jeonse price rose by 0.07%, also slowing from the previous month’s 0.25%. The metropolitan area (0.25%→0.01%), Seoul (0.24%→0.04%), and provinces (0.25%→0.12%) all showed a slowdown.

In Seoul (0.04%), prices rose mainly in areas near convenient transportation hubs or mid-to-low-priced areas. The increase was significant in Dongdaemun-gu (0.15%), Gangbuk-gu (0.14%), Gwangjin-gu (0.13%), and Guro-gu (0.09%). Gyeonggi-do (-0.01%) turned from rising to falling due to an increase in new housing supply. Incheon (0.02%) saw a slowdown in the rise due to inventory accumulation in Yeonsu and Seo-gu.

In the provinces, Gwangju (0.33%) showed an upward trend mainly in the advanced district with favorable residential conditions, and Chungbuk (0.30%) rose mainly in major areas with good transportation environments, but the rate of increase narrowed. Daejeon (-0.21%) turned downward mainly in Seo-gu and Yuseong-gu due to the impact of new housing supply. Sejong (-1.28%) continued its downward trend due to weakened transaction sentiment.

The nationwide comprehensive housing monthly rent increase rate was 0.16%, narrowing from the previous month’s 0.22%. The metropolitan area (0.24%→0.18%) and Seoul (0.18%→0.11%) saw a reduction in the rate of increase, and provinces (0.21%→0.13%) also showed a decrease.

In Seoul (0.11%), monthly rent demand increased due to the rise in jeonse loan interest rates and loan regulations. Gyeonggi-do (0.20%) rose mainly in undervalued areas and complexes such as Siheung and Anseong, and Incheon (0.26%) increased mainly in Yeonsu and Michuhol-gu with favorable residential environments, but the rate of increase narrowed compared to the previous month.

In the provinces, Ulsan (0.55%) rose mainly in mid-to-low-priced older buildings in Nam-gu and Dong-gu, Chungbuk (0.32%) rose mainly in Chungju and Cheongju along with jeonse prices, and Jeju (0.24%) increased mainly in Jeju-si with good living conditions. However, Sejong (-0.60%) fell due to accumulated jeonse inventory and decreased monthly rent demand.

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