Gangnam Area Housing Sales Quadruple Surge 'Press and It Jumps'

[Asia Economy Reporter Yoo In-ho] Despite the government's strong real estate regulations centered on Gangnam, housing sales and jeonse/wolse transactions in this area continue to increase explosively. This confirms the saying, "The more you press, the more it bounces."

According to the Ministry of Land, Infrastructure and Transport and the Korea Real Estate Board on the 23rd, the Gangnam real estate market, which has high school district demand, began to overheat from the second half of last year, with housing sales transactions in the Gangnam area of Seoul in December soaring to four times the level of the same period last year.

In December of last year, the number of housing transactions in the four Gangnam districts?Gangnam, Seocho, Songpa, and Gangdong?was 4,726, an increase of 355.3% compared to 1,038 transactions in the same month of the previous year. This is much higher than the overall Seoul housing transaction volume, which increased by 216.5% year-on-year during the same period. Housing transactions in the four Gangnam districts led the overall housing transaction volume in Seoul.

The volume of jeonse and wolse transactions for moving into this area also increased, which appears to be driven by school district demand. Based on confirmed dates, the jeonse/wolse transaction volume in the four Gangnam districts in December last year was 12,835, a 21.7% increase compared to 10,543 in the same month of the previous year.

Industry insiders say that changes in the market situation after the December 16, 2020 measures should be assessed by looking at statistics from January to February this year. If housing sales and jeonse/wolse transactions in the Gangnam area decrease in January and February, it will be interpreted that the government's policies have taken effect in the market.