Seoul Apartment Transactions at 'Only 20 per Day'... Fewer than Nowon-gu Two Years Ago

639 Cases in July, Average 20.6 Cases per Day
787 Cases in Nowon-gu in December 2020

Apartment view around Seoul./Photo by Jinhyung Kang aymsdream@

[Asia Economy Reporter Ryu Taemin] Due to the impact of interest rate hikes and economic recession, the volume of apartment transactions in Seoul has dropped to an all-time low. The total number of apartment transactions in Seoul averaged only 20 per day, which is actually less than the transaction volume in Nowon-gu two years ago.

According to the Seoul Real Estate Information Plaza on the 13th, the number of apartment sales in Seoul last July was 639, a decrease of 440 transactions (40.7%) compared to the previous month (1,079 transactions). The daily average transaction volume was only 20.6, which is an 86.4% decrease compared to the same period last year (4,679 transactions). This is even 148 transactions fewer than the transaction volume in Nowon-gu in December 2020, when apartment transactions in Seoul were at their peak (787 transactions).

In the case of last month, the number of apartment sales further decreased to 468 transactions. Considering that the reporting deadline for transactions is 30 days, the downward trend in apartment transaction volume is expected to continue. By district, Yongsan-gu (6 transactions), Jongno-gu (6 transactions), Gwangjin-gu (6 transactions), and Jung-gu (9 transactions) each recorded single-digit transaction volumes. Even Gangnam-gu, which had the highest number of transactions, recorded only 37 transactions.

The phenomenon of villa (multi-family and row houses) sales surpassing apartment sales in Seoul is also ongoing. In July, villa transactions totaled 2,440, about four times more than apartment sales. The number of villa transactions in Seoul has exceeded apartment transactions for 20 consecutive months since January last year. Until 2020, apartment transactions in Seoul outnumbered villa transactions, but since last year, buyers burdened by the skyrocketing apartment prices in Seoul have started turning their attention to villas, which have relatively lower entry barriers. Song Seunghyun, CEO of Urban and Economy, said, "With recent interest rate hikes increasing interest burdens, demand is dispersing from Seoul apartments, which require large loans, to villas or outskirts," and predicted, "This trend is expected to continue for the time being."

The same applies to the court auction market. According to real estate auction information company Gigi Auction, the winning bid rate for Seoul apartments last month was 93.7%, down 2.9 percentage points from the previous month. This is the lowest figure in 2 years and 5 months since March 2020 (83.3%). Lee Juhyun, senior researcher at Gigi Auction, said, "Because loan regulations apply equally to auction properties, buyers seem to feel burdened by financing," and forecasted, "The auction market will also show further slowdown."

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