Seoul Jeonse Prices Turn 'Down' After 8 Months... Sale Prices Stable for 5 Weeks

Seoul apartment jeonse prices have turned downward for the first time in eight months. Experts analyzed that the psychological contraction caused by the weakening of jeonse prices will also affect sales prices.

According to Real Estate R114 on the 17th, Seoul apartment jeonse prices fell by 0.01% in the second week of February. This marks a downturn for the first time in about eight months since July last year. The decline was larger in Songpa (-0.08%) and Yeongdeungpo (-0.05%). Meanwhile, Guro (0.05%), Yongsan (0.04%), Gwangjin (0.04%), and Gangdong (0.01%) showed an upward trend.

Real Estate R114 explained, “Jeonse prices, which had been rising for nearly seven months, were greatly affected by the decrease in demand during the Lunar New Year holidays, leading to additional areas where price movements have stopped or declined this month. Accordingly, sales prices are also expected to be influenced by psychological contraction due to the weakening of rental prices.”

In Gyeonggi and Incheon, jeonse prices rose by 0.01%. Suwon (0.04%), Hwaseong (0.03%), Icheon (0.02%), and Incheon (0.01%) increased, while Pyeongtaek (-0.03%), Gwacheon (-0.02%), and Uijeongbu (-0.01%) decreased. New towns recorded no change (0.00%). Ilsan rose by 0.02%, and Sanbon fell by 0.02%. There were no price changes in other new towns.

Seoul apartment sales prices remained flat (0.00%) for five consecutive weeks. Both Seoul reconstruction and general apartments showed no price changes. This is due to the slowdown in buying and selling activities during the Lunar New Year holidays. New towns maintained a flat trend for three consecutive weeks, and Gyeonggi and Incheon for four consecutive weeks.

However, some areas with favorable conditions continued their upward trend. Hwaseong (0.02%) and Ansan (0.01%), which have expectations for improved transportation networks such as the metropolitan area express railroad (GTX), are representative examples.

Real Estate R114 stated, “Recently, local movements have been detected in relatively undervalued areas due to transportation benefits (GTX, subway extensions, etc.) or development issues (business districts, redevelopment projects, etc.), but these have not led the overall market sentiment in Seoul and the metropolitan area. Since substantial institutional changes in the real estate market are unlikely during the election season, price movements in the form of ‘each surviving on their own’ will continue, centered on areas with less price burden or favorable conditions for the time being.”

Sangam-dong Apartment. Photo by Jo Yongjun jun21@

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