Gangnam Falls, Non-Gangnam Rises... Polarization in Seoul Apartment Price Trends Solidifies

The polarization of apartment prices in Seoul continues. While prices in the Gangnam area have been declining for over a month, outlying districts are consistently seeing an upward trend. Yongsan-gu, which had previously shifted to an upward trajectory, has once again turned downward.

According to the weekly apartment price trends for the second week of April (as of the 13th) released by the Korea Real Estate Board on April 16, the Seoul apartment sale price index rose by 0.10% from the previous week. This increase is the same as last week. With various policies such as the implementation of heavier capital gains taxes on multiple home owners starting next month and the refusal of loan maturity extensions, a wait-and-see approach is prevailing in the market.

There were differences by district. Gangnam-gu fell by 0.06%, while Seocho-gu (-0.06%) and Songpa-gu (-0.01%) also declined, marking eight consecutive weeks of negative growth. Yongsan-gu, which has been designated as an adjustment-targeted area along with the three Gangnam districts since the past, also dropped by 0.04%. After showing an upward or flat trend for the past two weeks, Yongsan-gu has turned downward again after three weeks.

An apartment complex in Gangnam-gu, Seoul. Photo by Yonhap News

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The remaining districts continued to see price increases. Gangbuk-gu rose by 0.27%, Gangseo-gu by 0.24%, and both Seodaemun-gu and Dongdaemun-gu by 0.20%, showing relatively large increases. Compared to the previous week's growth rates, Gangbuk-gu, Gwangjin-gu, Dobong-gu, and Dongjak-gu saw somewhat larger increases.

In contrast, Jung-gu and Nowon-gu showed a trend of smaller price increases. Among the 21 districts where apartment prices rose, 9 saw an expanded rate of increase, while the remaining 12 experienced a reduced increase. The Korea Real Estate Board explained, "While some areas saw downward transactions due to the appearance of price-adjusted listings, the city as a whole posted an increase as contracts were signed for highly preferred complexes."

The weekly increase in Seoul apartment jeonse prices was 0.17%. Since March 9, the growth in jeonse prices has gradually risen from 0.12% to 0.13%, then to 0.15%, 0.15%, and most recently 0.16%. The cumulative increase so far this year is 1.95%, a steep rise compared to the same period last year (0.36%).

By district, Gwangjin-gu (0.31%), Seongbuk-gu and Nowon-gu (both 0.30%), Songpa-gu (0.28%), and Gangbuk-gu (0.26%) posted relatively high jeonse price increases. The Korea Real Estate Board analyzed that, as the shortage of jeonse listings remains unresolved, demand for rentals continues to be concentrated in areas with better residential environments such as those near subway stations, resulting in frequent upward transactions.

Meanwhile, the nationwide apartment sale price growth rate was 0.03%, a slight decrease from the previous week's 0.04%. Nationwide jeonse prices rose by 0.09%, the same as the previous week.

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