70% of Seoul Housing Transactions Are Small Homes... Highest Ever Share of Houses Under 60㎡ Exclusive Area

Impact of Interest Rates Weakens Buying Sentiment
Shift Toward Smaller Units with Lower Costs
Among 34,945 Transactions in H1,
24,673 Units Are 60㎡ or Smaller
Rapid Increase in Single-Person Households Also Plays a Role

[Asia Economy Reporter Hwang Seoyul] It has been revealed that 7 out of 10 houses traded in Seoul in the first half of this year were small-sized homes with an exclusive area of 60㎡ or less. This is mainly attributed to real demand buyers flocking to relatively less costly small-sized houses amid a decline in purchasing sentiment due to rising housing prices and interest rate hikes.

According to an analysis of housing transaction status by size conducted by real estate information provider Economy ManLab on data from the Korea Real Estate Board, the proportion of housing transactions for homes with an exclusive area of 60㎡ or less accounted for 70.6% of total housing transactions in Seoul during the first half of this year (January to June). This is the highest proportion since related statistics began being compiled in 2006 (based on the first half of the year). The total number of housing transactions in the first half of this year was 34,945, with 24,673 transactions involving homes of 60㎡ or less.

Among the 25 autonomous districts in Seoul, Dobong-gu had the highest proportion of small-sized housing transactions with an exclusive area of 60㎡ or less. In the first half of this year, Dobong-gu recorded 1,299 housing transactions, of which 1,032 were small-sized homes, accounting for 79.4% of the total.

Following Dobong-gu, the districts with high proportions were △Gangseo-gu 79.0%, △Guro-gu 78.5%, △Gangbuk-gu 78.0%, △Geumcheon-gu 77.7%, △Eunpyeong-gu 77.0%, △Songpa-gu 76.4%, △Yangcheon-gu 75.7%, △Mapo-gu 73.3%, and △Jungnang-gu 73.2%. The district with the lowest proportion was Seongdong-gu (48.9%), followed by Gangnam-gu (51.8%) and Yongsan-gu (54.2%).

This phenomenon is interpreted as real demand buyers concentrating on small-sized houses with lower cost burdens amid rising housing prices and interest rate hikes. Hwang Hansol, a research analyst at Economy ManLab, said, "In a situation where purchasing sentiment is dampened due to high interest rates and loan interest burdens, attention is focused on small-sized houses with relatively less price burden," adding, "This trend of small-sized housing market leadership is expected to continue for some time."

Another reason cited is the sharp increase in single-person households residing in Seoul. According to Statistics Korea, the number of single-person households in Seoul was 854,606 in 2010, accounting for 24.4% of all households, increased to 1,115,744 (29.5%) in 2015, and was recorded at 1,489,893 last year, making up 36.8% of the total.

Meanwhile, in the first half of this year, houses with an exclusive area of 61~85㎡ recorded 5,724 transactions, accounting for 16.4% of the total, marking the lowest ever. During the same period, houses sized 86~100㎡ had 372 transactions (1.1%), and those sized 101~135㎡ had 1,203 transactions (3.4%). Houses with an exclusive area of 136㎡ or more recorded 2,973 transactions, accounting for 8.5% of the total.

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