Next Year’s Seoul Apartment Move-in Volume Drops Sharply... Growing Concerns Over the ‘Jeonse Crisis’

The expected number of apartment move-ins in Seoul next year is projected to be 25,000 units. The completion dates of some apartments have been delayed, reducing the initial estimate by about 3,000 units, and it is expected to decrease by 15,000 units compared to approximately 40,000 units this year. Experts predict that as the sales market slows and demand shifts toward jeonse (long-term lease), a decrease in apartment move-in volume could lead to a jeonse crisis.

[Image source=Yonhap News]

On the 15th, the Seoul Metropolitan Government announced that, based on this month's data, the expected apartment move-in volume for next year has been recalculated and is projected to be 25,000 units. The city typically discloses apartment move-in volumes twice a year, in February and August, categorized by redevelopment/reconstruction projects and non-redevelopment projects such as youth safe housing, public housing, and long-term lease housing near subway stations. However, reflecting recent changes in project statuses, the city has recalculated and disclosed the updated move-in volumes.

Next year, the number of apartments moving in Seoul is expected to be 25,124 units, which is 3,193 units fewer than the August estimate of 28,317 units. The decrease is due to the completion dates of redevelopment projects such as 'La Grande' (3,069 units) in Dongdaemun-gu and 'Lotte Castle East Pole' (1,363 units) in Gwangjin-gu being postponed from December next year to January 2025. However, the move-in volume for non-redevelopment projects increased by 1,058 units compared to the August estimate (15,494 units), as the public housing project 'Gangnam Seoul Suseo KTX A2 Block' was postponed to next year.

Experts predict that the shortage of apartment supply next year could trigger a jeonse crisis. As demand that was cautious in the sluggish sales market turns to jeonse, Seoul's jeonse prices are rising, and a reduction in apartment move-in volume could lead to a jeonse shortage. According to the Korea Real Estate Board, in the first week of November (as of the 6th), the apartment sales price change rate recorded 0.05%, showing a decreasing rate of increase, but the jeonse price change rate was 0.21%, marking the highest point of the year and continuing a steep upward trend.

Kim In-man, director of the Real Estate Economy Research Institute, explained, "As the sales market slows and sales waiting demand turns cautious, this demand is moving into the jeonse market, causing recent increases in jeonse prices. If the shortage of apartment supply next year becomes apparent, it could lead to a jeonse crisis."

However, the difficulties caused by the decrease in apartment move-in volume next year are expected to be resolved in early 2025. Although the expected move-in volume decreases in 2024, large-scale projects such as Olympic Park Foreon (Dunchon Jugong, 12,032 units), La Grande (Imun 1, 3,069 units), and Lotte Castle East Pole (Jayang 1 Reconstruction, 1,363 units) are scheduled for completion in January 2025, with about 16,464 units expected to move in.

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