Gangnam 3 Districts 'House Price Dream or Reality'?… Gangnam and Seocho Rise While Songpa Remains Steady

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

[Asia Economy Reporter Ryu Tae-min] Recently, even within the Gangnam 3 districts (Gangnam, Seocho, Songpa) that have led the rise in Seoul housing prices, differences are emerging by district. While apartment prices in Gangnam-gu and Seocho-gu, where major reconstruction complexes and ultra-high-end houses are concentrated, are rising at an increasing rate, Songpa-gu appears unable to break away from a downward or flat trend.

According to the weekly apartment price trend announced by the Korea Real Estate Board on the 4th, apartment sale prices in Gangnam-gu and Seocho-gu, Seoul, where major reconstruction complexes are densely located, rose by 0.12% each as of last month. The rate of change in the two districts had remained flat at 0.00% until the second week of March, but following the presidential election, expectations for redevelopment projects have increased, leading to six consecutive weeks of price increases. This is interpreted as due to growing expectations for deregulation of reconstruction under the new government. According to the Ministry of Land, Infrastructure and Transport's real transaction price disclosure system, a 155㎡ (exclusive area) unit in Shinhyundai 12th complex in Apgujeong-dong, Gangnam-gu, Seoul, was traded on the 15th of last month for 5.9 billion KRW, 400 million KRW higher than the previous transaction.

Additionally, as the tax burden on multi-homeowners increases, preference for owning a single, well-located property is rising again. Multi-homeowners are offloading properties in the outskirts of Seoul or relatively lower-demand areas and aiming to move to higher-tier areas such as Gangnam and Seocho, concentrating demand there. Last month, a 129.9㎡ unit in Acro River Park, Banpo-dong, Seocho-gu, was sold for 5.1 billion KRW, 1.2 billion KRW higher than the previous record price.

On the other hand, Songpa-gu, which is relatively pushed down in the ranking of high-priced houses due to concentrated demand in Gangnam and Seocho, seems to lack upward momentum. Songpa-gu shifted from a decline to flat in the second week of March but recorded a -0.01% drop again in the second week of last month. The perception that only the Jamsil area is considered part of the main Gangnam region is also one of the factors causing demand differences within Songpa-gu. In fact, an 84.98㎡ unit in Helio City, Garak-dong, Songpa-gu, was traded on the 14th of last month for 2.095 billion KRW, 275 million KRW lower than the highest price of 2.37 billion KRW.

Song Seung-hyun, CEO of City and Economy, said, "Gangnam and Seocho have a strong character as employment centers with many jobs and are home to representative reconstruction complexes, so they have strong potential for price increases," adding, "However, usually when Gangnam and Seocho move, surrounding areas follow, so it is expected that Songpa-gu will be next."

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