"Taking a Breather Before Chuseok Holiday" Seoul Apartment Prices Rise 0.05% This Week

Seoul Apartment Sale Prices Increase for 4 Consecutive Weeks with Narrowing Gains
"Jeonse Prices Expected to Continue Long-Term Upward Trend"

[Asia Economy Reporter Kim Yuri] Ahead of the Chuseok holiday, the rate of increase in Seoul apartment sale prices has slowed for four consecutive weeks. Compared to the end of August (as of August 28, 0.11%), the rate of change has dropped to about half. However, considering that about one to three months have passed since the announcements of the June 17, July 10, and August 4 policy measures, it seems more time is needed before a decline due to policy effects can be observed. Meanwhile, the rise in jeonse (long-term lease) prices is relatively more pronounced. The increase rate is about twice that of sale prices. As jeonse properties have become scarce in the market, competition among tenants is expected to intensify further due to the influx of subscription demand for the 3rd new town developments.

According to Real Estate 114 on the 25th, this week Seoul apartment sale prices rose by 0.05%. Although the rate of change decreased compared to the previous week (0.06%), the upward trend continued. Reconstruction and general apartments rose by 0.03% and 0.06%, respectively. Gyeonggi and Incheon increased by 0.07%, and new towns rose by 0.04%.

In Seoul, the increases were in the order of Nowon (0.11%), Songpa (0.11%), Gangdong (0.08%), Gangbuk (0.06%), Guro (0.06%), Geumcheon (0.06%), Dobong (0.06%), Yeongdeungpo (0.06%), and Eunpyeong (0.06%). Nowon, where mid-to-low priced apartments under 900 million KRW are concentrated, saw a slight decrease in the rate of increase, but listings also decreased simultaneously, creating an atmosphere where asking prices do not easily drop. Yangji Daerim 1st Complex in Junggye-dong and Hanshin Cheonggu in Hagye-dong rose by 5 to 10 million KRW. In Songpa, Olympic Family Town in Munjeong-dong and Rescence in Jamsil-dong increased by 5 to 25 million KRW. In Gangdong, Godeok Raemian Hillstate and Godeok Gracium in Godeok-dong rose by 5 to 15 million KRW. In Gangbuk, Hanil U&I and Gyeongnam Honorsville in Mia-dong increased by 10 to 15 million KRW.

In new towns, Ilsan (0.09%), Bundang (0.08%), Paju Unjeong (0.06%), Pyeongchon (0.02%), Pangyo (0.02%), and Gwanggyo (0.02%) rose in that order. In Ilsan, Hosu 2nd Complex Hyundai in Janghang-dong, Hugok 18th Complex Hyundai in Ilsandong, and Gangseon 3rd Complex Hanshin in Juyeop-dong increased by 5 to 7.5 million KRW. In Bundang, Hyoja Samhwan in Seohyeon-dong, Maehwa Village Geonyeong 1st Complex in Yatap-dong, and Cheongsol Daewon in Geumgok-dong rose by 5 to 20 million KRW. In Paju Unjeong, Hanbit Village 2nd Complex Humanville Lake Palace in Yadang-dong increased by 5 million KRW.

In Gyeonggi and Incheon, Gwangmyeong (0.16%), Namyangju (0.13%), Yongin (0.12%), Hanam (0.12%), Gwacheon (0.11%), and Guri (0.11%) rose in that order. Conversely, some relatively peripheral areas such as Gwangju and Anseong remained flat. In Gwangmyeong, relatively new complexes such as Gwangmyeong Haemoro Iyeon in Gwangmyeong-dong, Cheolsan Raemian Xi in Cheolsan-dong, and Gwangmyeong Doosan We've Trizium in Ha-an-dong rose by 5 to 10 million KRW. In Namyangju, Byeolnae-dong Byeolbit Village Shinil Utovil and Mirinae Village Hanwha Dream Green increased by 5 to 10 million KRW. In Yongin, Giheung Station Lotte Castle Sky in Singal-dong rose by 5 million KRW, and Eojeong Village Lotte Castle Eco 1st Complex in Jung-dong increased by 10 million KRW.

The metropolitan area jeonse market saw a rise amid increasing scarcity of properties, with Seoul rising by 0.10%. Gyeonggi, Incheon, and new towns rose by 0.09% and 0.05%, respectively.

In Seoul's jeonse market, the shortage of properties continues, with steady demand inflow into Gangdong and Nowon. By region, Gangdong (0.28%), Nowon (0.24%), Gangbuk (0.16%), Dobong (0.16%), and Gangnam (0.13%) rose in that order. In Gangdong, Godeok Gracium and Godeok Raemian Hillstate in Godeok-dong, and Samik Green 2nd Complex in Myeongil-dong increased by 5 to 25 million KRW. In Nowon, Sanggye Jugong 7th Complex in Sanggye-dong and Gyeongnam Honorsville in Junggye-dong rose by 5 million KRW. In Gangbuk, Byeoksan Live Park, Hanil U&I, and Gyeongnam Honorsville in Mia-dong increased by 5 to 10 million KRW.

In new towns, Ilsan (0.13%), Pangyo (0.10%), Bundang (0.07%), Sanbon (0.07%), and Jung-dong (0.06%) rose in that order. In Ilsan, Jangseong 4th Complex Daemyeong in Daehwa-dong, Gangchon 1st Complex Dong-A in Madu-dong, and Hugok 17th Complex Taeyoung in Ilsandong rose by 5 million KRW. In Pangyo, Botdeul Village 1st Complex Pungsung Shinmiju in Sampyeong-dong increased by 10 million KRW. In Bundang, Jangmi Kolon in Yatap-dong, Hyoja Hwaseong in Seohyeon-dong, and LG rose by 5 million KRW.

In Gyeonggi and Incheon, the rise was notable in Hanam, which has subscription demand for the 3rd new town and the benefit of the Line 5 extension. Hanam (0.21%), Gwangmyeong (0.18%), Namyangju (0.17%), Uiwang (0.15%), Yongin (0.13%), and Goyang (0.12%) rose in that order. In Hanam, Hyundai Hometown in Sinjang-dong, Daemyeong Riverside Town, Booyoung in Changwoo-dong, and Misa Riverside Dongil Highvill in Pungsan-dong increased by 10 million KRW. In Gwangmyeong, Gwangmyeong Doosan We've Trizium in Ha-an-dong and Cheolsan Raemian Xi in Cheolsan-dong rose by 10 million KRW. In Namyangju, Mirinae Village Hanwha Dream Green in Byeolnae-dong and Namyang i-Good House in Dasan-dong increased by 5 to 10 million KRW.

Ahead of the Chuseok holiday, the apartment sale market seems to have entered a pause. Yoon Jihae, senior researcher at Real Estate 114, said, "Transaction volume has significantly decreased, and although listings are not accumulating, the price gap between sellers and buyers is wide," adding, "This tug-of-war phase is likely to continue for a considerable period even after the holiday."

Meanwhile, the jeonse market is experiencing a scarcity of properties during the moving season, continuously driving prices up due to scarcity issues. Senior researcher Yoon said, "Competition among tenants over the few available jeonse properties is intensifying, so the current upward trend is expected to continue for a considerable time."