Effect of Deregulation? Seoul Apartment Price Decline Slows... Withdrawals of Listings Also Observed

Seoul Declines for 32 Consecutive Weeks... "Buy Inquiries Quiet"
Nationwide City and Province Sale Price Drops Narrow Except Chungnam
Jeonse Prices Also Show Reduced Decline... "Steady Quick Sale Transactions"

[Asia Economy Reporter Noh Kyung-jo] The decline in apartment sale prices nationwide, including Seoul, narrowed compared to the previous week. Although the desired purchase prices continue to fall amid a transaction freeze, this is interpreted as an effect of the easing downward pressure on asking prices due to the announcement of real estate regulation relaxations.

View of an apartment complex from Namsan, Seoul / Photo by Yonhap News

According to the weekly apartment price trend announced by the Korea Real Estate Board on the 5th, Seoul apartment prices fell by 0.67% in the first week of January (as of the 2nd). This is a 0.07 percentage point decrease in the rate of decline compared to last week's -0.74%, marking the first slowdown in the rate of decline in 9 months (39 weeks) since April last year.

The Real Estate Board stated, "As buyers remain cautious and inquiries during the year-end and New Year period have been sparse, the announcement of government real estate regulation easing has led to cases of withdrawal of listings, resulting in a reduced rate of decline compared to the previous week."

By district, Nowon-gu (-1.17%) continued to decline mainly in Sanggye, Junggye, and Gongneung-dong, and Dobong-gu (-1.12%) sustained its downward trend mainly in small-sized apartments in Banghak, Ssangmun, and Chang-dong. Seongbuk-gu and Eunpyeong-gu fell by 0.97% and 0.92%, respectively. South of the Han River, Yeongdeungpo-gu (-0.72%) experienced the largest drop. This was followed by Geumcheon-gu (-0.65%), Gangseo-gu (-0.59%), and Dongjak-gu (-0.58%). Areas where the rate of decline increased compared to the previous week included Dongdaemun-gu (-0.78% → -0.84%), Yangcheon-gu (-0.41% → -0.42%), and Geumcheon-gu (-0.72% → -0.71%).

Gyeonggi (-0.86%) and Incheon (-0.99%) showed declines within 1%. However, Icheon-si in Gyeonggi (-1.99%) continued to decline due to the contraction of local infrastructure projects, Gwangmyeong-si (-1.52%) fell mainly in large complexes in Cheolsan, Iljik, and Haan-dong, and Deogyang-gu in Goyang-si (-1.38%) saw apartment prices drop mainly in large complex-dense areas such as Haengsin and Hyangdong-dong.

In Incheon, Yeonsu-gu (-1.32%) saw a significant contraction in buyer sentiment due to move-in (planned) volumes and interest rate burdens, with the decline in Songdo New Town spreading to nearby areas. Seo-gu (-1.05%) saw price drops mainly in major complexes in Geomdan New Town and Simgok, Yeonhui, and Gajeong-dong.

The five major metropolitan cities in the provinces also saw a slight narrowing of the decline rate (-0.60%) compared to the previous week (-0.68%). Among all cities and provinces nationwide, only Chungnam (-0.25 → -0.28%) increased its rate of decline, and Sejong recorded the largest decline for five consecutive weeks, falling 1.31% due to new move-in volumes.

The jeonse (long-term lease) market saw a reduced rate of decline as overall jeonse inquiries decreased due to seasonal effects. The Real Estate Board reported that under a tenant-favorable environment, tenants expecting further jeonse price drops continue to push for lower asking prices and quick-sale transactions.

Nationwide, jeonse prices fell by 0.82%, while the metropolitan area and Seoul each declined by 1.15%. The decline rates in Gyeonggi and Incheon were 1.17% and 1.04%, respectively. In the provinces, Sejong (-1.40%) had the largest decline, followed by Daegu (-0.82%), Busan (-0.67%), and Daejeon and Ulsan (each -0.59%).

The Real Estate Board explained, "Jeonse prices fell due to continued inventory accumulation and weakened transaction sentiment."

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