Leading Apartment Prices 'Fluctuate'

KB Leading 50 Index Rises 0.26%

Seocho and Gangnam Turn to Rise After 8 Weeks

[Asia Economy Reporters Minyoung Kim, Taemin Ryu] The real estate market, which had been holding its breath under the worst 'transaction cliff,' is stirring as attention focuses on President-elect Yoon Seok-yeol's remarks. As the new government shows signs of easing reconstruction regulations, listings in reconstruction complexes are disappearing, and record-high transactions are being observed, indicating an unusual situation. Jongno and Yongsan are also heating up amid plans to relocate the presidential office. There are concerns that the process of lifting the Moon Jae-in administration's real estate regulations could stimulate housing prices in the short term, highlighting the need for the new government to devise precise policies.

According to the weekly apartment trend report by the Korea Real Estate Board on the 28th, as of the 21st, housing prices in Yangcheon-gu, which includes the reconstruction complex Mokdong, remained flat for two consecutive weeks. Seocho-gu and Gangnam-gu each rose by 0.01%, turning to an upward trend after 8 weeks. Songpa, where reconstruction fever is hot with complexes like Jamsil Jugong 5, also stopped declining and showed a flat trend.

Also, according to KB Real Estate, the 'KB Leading Apartment 50 Index' rose 0.26% this month compared to the previous month. This index selects the top 50 apartment complexes nationwide by market capitalization and shows the rate of change in market capitalization. It is highly sensitive to price changes and is used as a leading indicator to forecast the market. From June to November last year, it maintained an average monthly rate of around 1%, but dropped to the 0% range starting December when the sales market began to freeze. In particular, last month it plummeted to 0.09%, marking the lowest level in 21 months. However, it rebounded this month as expectations for easing reconstruction regulations grew. The Leading 50 Index includes many high-priced reconstruction complexes in Seoul such as Eunma, Apgujeong Hyundai, and Jamsil Jugong. The increased tax burden on multi-homeowners also seems to have raised the preference for owning a 'smart single home' again. Song Seung-hyun, CEO of Urban and Economy, said, "With the uncertainty of the presidential election resolved and expectations for deregulation rising, the market is showing signs of revitalization."

The plan to relocate the presidential office also appears to be fueling this market sentiment. According to the real estate big data platform Asil, since the plan was formalized on the 15th, listings in Jongno-gu have decreased by 1.9%. This is the only case of a decrease in listings among Seoul's autonomous districts. This is interpreted as a spread of the atmosphere that development plans, which had been blocked due to the proximity to the Blue House, may gain momentum. Yongsan-gu also showed a trend of withdrawing listings after the 20th, but as of this day, listings increased by 2.1% from 891 to 910. This is seen as creating anxiety that it is still unclear what impact this will have on the market.

Concerns were immediately raised that expectations for the new government's policies could cause short-term overheating in the real estate market. President-elect Yoon seemed aware of this and requested at the Ministry of Land, Infrastructure and Transport briefing to ensure that deregulation does not lead to short-term market instability. Seo Jin-hyung, president of the Korea Real Estate Society (professor at Gyeongin Women's University), said, "It is true that supplying housing through deregulation is a desirable direction for market stabilization," but added, "To prevent short-term market overheating, appropriate speed control in pursuing deregulation seems necessary."

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