Record-Breaking Ice Trade... Seoul October Likely to Fall Below 600 Cases

The Bank of Korea raised the base interest rate by 0.5 percentage points, and the real estate transaction market is expected to experience a prolonged winter. On the 13th, a red light was on at a traffic signal near an apartment in downtown Seoul.

[Asia Economy Reporter Kim Hyemin] Seoul apartment transaction volume is facing an unprecedented ice age. As the transaction cliff turns into a disappearance state, the possibility of breaking the all-time low again has increased.

According to the Seoul Real Estate Information Plaza on the 22nd, the apartment transaction volume in Seoul last month was recorded at 518 cases, the lowest so far this year. Since reporting must be done within 30 days after the contract, there is about a week left, but the consensus is that it will be difficult to exceed 600 cases if the current trend continues.

Seoul apartment transaction volume has repeatedly broken the all-time low record this year. This is due to the intensified buyer's wait-and-see stance that deepened since the second half of last year. Since the statistics began in 2006, the volume has never fallen below 1,000 cases, but this year alone, it has happened four times from January to September. After initially dropping to 818 cases in February, it briefly rose, but from July, it has remained in the 600 range for three consecutive months. Meanwhile, the October transaction volume is likely to shrink to the 500 range, failing to even exceed 600 cases.

Among the 25 autonomous districts, three had single-digit transaction volumes in October. Gwangjin-gu recorded 9 cases, and Jongno-gu only 4 cases. Yongsan-gu, which continued its price rise even during this year's housing price adjustment period, also saw a contraction in transactions with only 8 cases. According to the Ministry of Land, Infrastructure and Transport's actual transaction price disclosure system, Helio City in Garak-dong, Songpa-gu, which has 9,510 households, recorded only 5 transactions last month. Eonma in Daechi-dong, Gangnam-gu, with 4,424 households, also recorded only 2 cases.

The unprecedented contraction in transactions is due to the rapidly rising base interest rate increasing loan interest burdens, and as a result, housing prices have fallen, causing buyer sentiment to hit rock bottom. Experts expect this trend to continue until the first half of next year. The situation is the same this month. As of this day, the apartment transaction volume in November stood at 119 cases.

Park Wongap, Senior Real Estate Specialist at KB Kookmin Bank, said, "Interest rates act as the gravity of all asset markets, and transactions do not occur unless it is a forced sale," adding, "Until the interest rate hike stops, the decrease in transaction volume and price decline will inevitably continue."

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