‘High Interest Rates and Transaction Freeze’ Leave No Defense... Seoul Apartment Prices See Largest Drop in 10 Years

Apartment complex in Seoul area (Photo by Asia Economy DB)

[Asia Economy Reporter Ryu Taemin] Seoul apartment prices have recorded the largest weekly decline in over 10 years, continuing a downward trend for 20 consecutive weeks.

According to the weekly apartment price trend for the second week of October announced by the Korea Real Estate Board on the 13th, as of the 10th, the apartment sale price change rate in Seoul showed a 0.22% decrease. The decline widened compared to the previous week (-0.20%), marking 20 consecutive weeks of decline.

Among the 14 districts in northern Seoul, Dobong-gu (-0.40%) and Nowon-gu (-0.40%) showed the largest drops. Following were Eunpyeong-gu (-0.29%), mainly in large complexes in Jingwan, Nokbeon, and Eungam-dong, and Seodaemun-gu (-0.28%), where the decline widened due to continued inventory accumulation mainly in large complexes in Namgajwa-dong and older buildings in Hong Eun-dong.

In the Gangnam area, Songpa-gu (-0.31%) declined mainly in large complexes in Jamsil, Songpa, and Munjeong-dong where falling transactions occurred. Gangseo-gu (-0.23%) showed a downward trend mainly in major complexes in Naebalsan and Gayang-dong. Gangdong-gu (-0.22%) saw an expanded decline mainly in Godeok, Myeongil, and Amsa-dong. Seocho-gu recorded a 0.05% decline, the smallest among Seoul's autonomous districts.

Incheon (-0.31%→-0.38%) saw a further widening of the decline. Due to concerns over a downturn in the real estate market caused by interest rate hikes, purchase inquiries decreased, leading to declines in Seo-gu (-0.45%) mainly in Gajeong and Majon-dong, Yeonsu-gu (-0.43%) mainly in Songdo New City, and Jung-gu (-0.40%) mainly in Jungsan and Bukseong-dong.

Gyeonggi-do (-0.26%→-0.30%) also deepened its downward trend. Icheon-si (-0.02%) turned to a decline amid a cautious stance. Suwon Yeongtong-gu (-0.79%) declined mainly in Mangpo and Maetan-dong, affected by supply volume. Seongnam Sujeong-gu (-0.70%) declined mainly in Changok and Taepyeong-dong. Additionally, Seongnam Jungwon-gu (-0.50%) declined mainly in Geumgwang and Sangdaewon-dong, Yangju-si (-0.44%) mainly in Goam and Okjeong-dong, and Paju-si (-0.44%) mainly in Mokdong and Dongpae-dong, continuing the downward trend.

Sejong saw apartment prices fall by 0.45%, an increase in the decline compared to the previous week (-0.39%).

Real estate brokerage offices around Seoul (Photo by Yonhap News)

In the apartment jeonse (long-term lease) market, last week Seoul (-0.20%→-0.22%) continued to experience inventory accumulation due to tenants' preference for renewal contracts, monthly rent, and half-jeonse, while concerns over additional interest rate hikes led to steady downward price adjustments for new jeonse listings, expanding the decline.

South of the Han River, Songpa-gu (-0.52%) declined mainly in major complexes in Jamsil and Songpa-dong; Gangdong-gu (-0.28%) declined mainly in Amsa, Godeok, and Gangil-dong; Gwanak-gu (-0.23%) declined mainly in major complexes in Sillim and Bongcheon-dong; and Yangcheon-gu (-0.22%) declined mainly in large complexes in Sinjeong and Mokdong, deepening the downward trend.

North of the Han River, Jongno-gu (-0.32%) declined mainly in large complexes in Sungin and Changsin-dong; Eunpyeong-gu (-0.31%) declined mainly in large complexes in Eungam and Bulgwang-dong; Seodaemun-gu (-0.30%) declined mainly in small to medium complexes in Namgajwa, Bukgajwa, and Hyeonjeo-dong; Seongbuk-gu (-0.30%) declined mainly in Gireum and Donam-dong; and Jung-gu (-0.28%) declined mainly in Sindang and Malli-dong, continuing the downward trend.

The entire metropolitan area fell by 0.32%, with Incheon and Gyeonggi-do each recording -0.37%, continuing the atmosphere of further price drops. In Incheon, inventory accumulation continued due to new supply, with Seo-gu (-0.48%) declining mainly in Sinhyeon and Gajeong-dong, Jung-gu (-0.43%) mainly in Jungsan and Unnam-dong, and Bupyeong-gu (-0.38%) mainly in Samsan and Sangok-dong, expanding the decline.

In Gyeonggi-do, Icheon-si (0.07%) rose due to increased buying demand mainly in Jungpo-dong and Bubal-eup, which have good proximity to workplaces. Conversely, Uijeongbu-si (-0.78%) continued to be affected by inventory accumulation mainly in Nagyang and Millak-dong, and Suwon Yeongtong-gu (-0.77%) saw declining transactions mainly in small (quasi) new buildings in Mangpo and Sindong. Additionally, Paju-si (-0.70%) declined mainly in aging complexes in Dongpae and Mokdong-dong, and Hanam-si (-0.60%) continued to decline mainly in Mangwol and Sinjang-dong, with the decline widening compared to the previous week.

Sejong's jeonse prices fell by 0.44% last week, slightly widening the decline compared to the previous week (-0.43%).

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