Increasing Urgent Sales... Seoul Apartment Prices on the Brink of Decline

Price Increase Slows in Nowon, Dobong, and Gangbuk
Urgent Sales Rise Not Only in Gangnam but Also in Yeouido
Seoul Home Prices Flat for 2 Weeks, 6 Districts at 0%

[Image source=Yonhap News]

[Asia Economy Reporter Moon Jiwon] Analysis that the decline in Seoul housing prices is entering the final countdown is gaining traction. The decline in apartment prices in the Gangnam area is widening, and the growth rate in Nowon, Dobong, and Gangbuk districts (known as No-Do-Gang), which had supported Seoul housing prices, is also decreasing.

According to the Korea Real Estate Board on the 27th, as of the 23rd, Seoul apartment prices remained flat compared to the previous week. Among individual districts, six districts including Jongno, Seongdong, Gwangjin, Seongbuk, Gangdong, and Jung recorded a 0% increase rate. Considering that only Gwangjin was flat last week, the number of areas where housing price growth has stopped is rapidly increasing.

Except for the No-Do-Gang area and the Geumcheon, Gwanak, and Guro districts (known as Geum-Gwan-Gu), most other districts saw increases limited to 0.01~0.03%. The Korea Real Estate Board analyzed, "Due to domestic and international economic crises, increases in official property prices, and strengthened proof of funding sources, buying sentiment has weakened," adding, "The decline has expanded mainly in high-priced homes with increased holding tax burdens."

The housing price growth in the No-Do-Gang area, which had shown relatively high increases, is now slowing down. Nowon District's growth rate has decreased over the past three weeks from 0.09% to 0.06% to 0.05%, and Dobong and Gangbuk districts reduced their growth rate from 0.08% last week to 0.06%.

In fact, the actual transaction price of a 58.65㎡ Doosan Apartment in Sanggye-dong, Nowon-gu, was 400 million KRW in January but dropped by 25 million KRW to 375 million KRW on the 9th of this month. The 36.34㎡ Jugong 17 Complex in Chang-dong, Dobong-gu, was traded at 242 million KRW and 285 million KRW in January and February respectively, but the actual transaction price fell to 230 million KRW on the 13th.

Urgent sale properties that appeared in the Gangnam area are spreading to other regions. A 118.12㎡ apartment in Yeouido Shibeom Apartments, Yeongdeungpo-gu, was traded at 1.95 billion KRW in December last year but is currently listed at 1.88 billion KRW, with lower floors reportedly priced down to 1.85 billion KRW. A 121.52㎡ unit in Eunha Apartments, Yeouido, sold for 1.625 billion KRW last month, but the current asking price is around 1.59 to 1.6 billion KRW.

A 59㎡ unit in Mapo Raemian Prugio, Mapo-gu, is also listed at 1.25 billion KRW, 80 million KRW lower than the actual transaction price of 1.33 billion KRW on the 7th. A representative from Yeouido A Real Estate said, "Multi-homeowners who sell homes held for more than 10 years in regulated areas such as Seoul until the end of June can receive capital gains tax benefits, so the number of urgent sales is increasing."