Gangnam Apartment Price Decline Eases... Seocho Turns Upward, Gangnam Stabilizes

Korea Real Estate Board's Weekly Apartment Price Trends for the Fourth Week of April

The decline in apartment prices in Gangnam, which had persisted for about two months, is showing signs of coming to a halt. Following Songpa District last week, Seocho District also shifted to an upward trend this week. This is believed to be due in part to the absorption of a significant amount of 'urgent sales,' which had previously led the decline, ahead of the implementation of the heavy capital gains tax on multi-homeowners scheduled for next month.

According to weekly apartment price trend data for the fourth week of April (as of the 27th) released by the Korea Real Estate Board on April 30, apartment prices in Seoul rose by 0.14% compared to the previous week. This is a rate similar to last week's increase of 0.15%.

By district, Seocho stands out for reversing its downward trend. After nine consecutive weeks of decline, it recorded a 0.01% increase. Having shown signs of the decline slowing, Seocho shifted to an upward trend for the first time in ten weeks. Previously, Songpa District reversed course after nine weeks of decline with a 0.07% uptick last week, and this week, it rose by 0.13%, marking a greater increase.

Urban apartments viewed from Namsan Mountain in Seoul. Photo by Yonhap News Agency

Gangnam District saw a 0.02% decrease compared to the previous week. While this marks the tenth consecutive week in negative territory, the decline is the smallest since the downtrend began in late February. If the current trend continues, it is likely that Gangnam will soon transition to an upward trajectory. Yongsan District, which is often grouped with the three major Gangnam districts as a declining area, fell by 0.03%, marking its third straight week of decline, with the drop unchanged from the previous week.

Following last year's lending restrictions and this year's reinstatement of the heavy transfer tax, as well as the potential reduction of tax deductions for non-residents, various policy issues have led to opposing trends in Seoul apartment prices between the three major Gangnam districts and other areas. In the three major Gangnam districts, concerns over property tax burdens have contributed to a decline lasting more than two months. In contrast, demand has remained strong in outlying areas, especially where buyers have relatively greater financial resources, resulting in a steady upward trend.

The recent stabilization in the Gangnam area is attributed to the completion of most transactions at lower prices, with an increase in purchases at higher prices in certain complexes. While there was recently a tendency for sellers to lower their asking prices for a quick sale, more owners are now raising their asking prices again.

Yonhap News Agency

According to local real estate agents, the asking price for a 84-square-meter unit at Raemian One Bailey in Seocho District was around 5.7 billion won earlier this month, but recently, many homeowners are listing them for just above 6 billion won. For a similar 84-square-meter unit at Helio City in Songpa District, the current asking prices are in the 3.1 to 3.2 billion won range, which is 200 to 300 million won higher than at the beginning of this month.

Apartment prices in the outskirts of Seoul have seen a slight slowdown in their rate of increase. In most areas, the rate of increase has moderated compared to the previous week, including Seongbuk District (from 0.27% to 0.21%), Gangseo District (from 0.31% to 0.21%), Gwanak District (from 0.28% to 0.21%), and Gwangjin District (from 0.22% to 0.13%).

The rate of increase in apartment rental prices in Seoul has accelerated in certain districts. While the overall rise for Seoul was 0.20%, slightly down from the previous week's 0.22%, Songpa District (from 0.39% to 0.51%) and Seongdong District (from 0.16% to 0.25%) saw significant increases. The Korea Real Estate Board explained, "With a shortage of available listings and a rise in rental inquiries, strong demand for popular complexes such as those near subway stations or in large complexes has led to the signing of rentals at higher prices."

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