Buying Sentiment Hits Lowest in 10 Years 5 Months... Seoul Metropolitan Area Drops Below 70 Threshold

A red light is on at a traffic signal near an apartment in downtown Seoul. (Photo by Asia Economy DB)

[Asia Economy Reporter Ryu Tae-min] As Seoul apartment prices have recorded the largest decline for four consecutive weeks, buying sentiment has fallen to its lowest level in 10 years and 5 months.

According to the Korea Real Estate Board on the 2nd, this week's Seoul apartment sales supply-demand index dropped further to 66.7 from last week's 67.9. This is the lowest figure in 10 years and 5 months since the Korea Real Estate Board began statistical aggregation in July 2012. The sales supply-demand index being below the baseline of 100 means that there are more people wanting to sell houses than those wanting to buy in the market.

The Seoul apartment supply-demand index has remained below the baseline for a year (55 consecutive weeks) since it fell below 99.6 in the third week of November last year, indicating a seller's market where there are more sellers than buyers. Due to this supply-demand imbalance, a transaction cliff continues. According to the Seoul Real Estate Information Plaza, the total number of apartment sales transactions in Seoul in October was 555, the lowest monthly figure since the actual transaction survey began in 2006.

Looking at Seoul by region, the index for the northwest area, including Eunpyeong, Mapo, and Seodaemun districts, fell from 63.8 last week to 62.4, marking the lowest among the five major regions of Seoul. The northeast area, including Nowon, Dobong, and Gangbuk districts, dropped from 64.5 last week to 63.9 this week, and the central area, including Yongsan, Jongno, and Jung districts, decreased from 66.3 to 65.8. The southeast area, including Gangnam, Seocho, Songpa, and Gangdong districts, also fell from 75.0 last week to 74.1 this week, while the southwest area, including Yeongdeungpo, Yangcheon, Dongjak, and Gangseo districts, recorded 66.0 this week, down from 68.0 last week.

The Gyeonggi Province sales supply-demand index dropped from 72.0 last week to 70.8. Incheon fell from 70.8 to 69.6, breaking below the 69 mark. Accordingly, the overall metropolitan area sales supply-demand index also fell from 70.5 last week to 69.4 this week, breaking below the 70 mark. Simply put, this is the lowest level in 10 years and 4 months since the first week of July 2012, when it was 61.5.

The nationwide apartment sales supply-demand index fell to 74.4 from last week's 75.9, marking a record low. The Real Estate Board explained, “Due to the continuous base interest rate hikes, the burden of loan interest has caused jeonse (long-term lease) demand to shift to monthly rent, and existing sales listings are also converting to jeonse, deepening the inventory backlog.” They added, “Declining transactions and price adjustments of listings are steadily progressing, with the rate of decline expanding compared to last week.”

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