Seoul Metropolitan Area Apartment Presale Prices Rise 16.6% in One Year

The selling price of apartments in the Seoul metropolitan area has risen by over 16% in just one year.

According to a 22 April analysis by RealToday, a real estate information provider, of presale price data from the Housing and Urban Guarantee Corporation (HUG), the average presale price for private apartments in the Seoul metropolitan area stood at 33.02 million won per 3.3 square meters as of March this year. This represents a 2.6% increase from 32.17 million won a month earlier. Compared to 28.32 million won a year ago, it is a 16.6% jump. When converted to the standard 84 square meters, known as the "national average size," this means that purchasing a new apartment in Seoul now costs around 1.1 billion won on average.

The rise in presale prices is attributed to several factors: increases in raw material prices, higher labor costs, and the application of stricter construction standards. In addition, the burden of financial costs, such as interest on real estate project financing (PF) loans due to the high interest rate environment, has been passed on to presale prices.

Both the supply of available land for building homes and the number of newly built homes are decreasing. This year, the total number of apartment move-ins in the Seoul metropolitan area is expected to reach only 112,064 units, a decrease of 15.1% compared to last year. The number of building permits-an indicator of future housing supply-also fell by 24.6% year-to-date as of February, compared to the same period last year.

A perspective view of 'Anyang Station Central IPARK Sujain,' which was sold in February. IPARK Hyundai Development Company·BS Hanyang

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As a result, even with high presale prices, complexes with clear future value are attracting a large number of applicants. RealToday analyzed, "As presale prices rise, buyers are seeking clear asset value stability," adding, "They are focusing on complexes that offer not only reputable brands but also locations near subway stations, excellent school districts, and clear development benefits."

For example, "Anyang Station Central IPARK Sujain," which was sold in Manan-gu, Anyang-si, Gyeonggi Province last February, had a presale price of over 1.26 billion won for an 84-square-meter unit, but still attracted 182 applicants for a single unit. Overall, 1,904 applications were submitted for 185 units available to the general public in the first round, resulting in a competition rate of 10.29 to 1. Manan-gu in Anyang-si is not subject to the stricter real estate regulations that apply in other parts of the metropolitan area, so restrictions on re-winning and resale are relatively relaxed. In addition to Anyang Station on Line 1, the opening of the double-track Wolgot-Pangyo Line (Wolpanseon) in November 2029 will make this a "double-station" complex.

Similarly, "Ssangyong The Platinum Onsu Station," supplied in Sosa-gu, Bucheon, recorded a competition rate of 12 to 1, with 1,317 applicants for 109 units, despite being priced at the highest level in Bucheon. The presale price for an 84-square-meter unit was 1.1376 billion won. Comparing this to "e-Pyunhansesang Onsu Station"-a nearby complex that opened in 2020-where a unit of the same size was sold for 850 million won (24th floor) on 19 April, the new complex is nearly 300 million won more expensive. Onsu Station near the complex is a "double-station" served by both subway Line 1 and Line 7. The core subway lines directly connect to Seoul's Gangnam and Yeouido districts, making it possible to fully enjoy the "Seoul lifestyle," which is believed to offset the burden of the high presale price.

Experts predict that, as the factors driving up construction costs remain unresolved and the housing supply shortage persists, the upward trend in presale prices is likely to continue for the time being.

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An industry insider commented, "With construction cost hikes still in play and supply indicators worsening, the perception that today is the cheapest it will get is spreading." He added, "It's true that resistance to higher prices is growing, but for locations with clear advantages and brand reliability, buyers are actively applying, expecting these complexes to lead the local market in the future."

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