[2020 National Audit] Seoul Landmark Apartment Prices Doubled Under Moon Administration

[Image source=Yonhap News]

[Asia Economy Reporter Lee Ji-eun] The sale prices of landmark apartments in Seoul have nearly doubled on average over the three years of the Moon Jae-in administration.

On the 18th, the office of Song Seok-jun, a member of the National Assembly Land, Infrastructure and Transport Committee from the People Power Party, announced that their independent investigation of actual transaction prices for landmark apartments across Seoul's 25 districts showed a 106% increase in actual transaction prices from the second quarter of 2017 to the third quarter of 2020.

Meanwhile, data from the Ministry of Land, Infrastructure and Transport and the Korea Appraisal Board showed that during the same period, the average sale price index for Seoul's 25 districts was 114.8, and the actual transaction price index was 150.4. The sale price index rose by 14.8%, and the actual transaction price index rose by 50.4%, which is only about one-seventh and one-half, respectively, of the increase rate calculated by Song's office.

Song stated, "The sale price index and actual transaction price index do not reflect the public's perspective and preferences," adding, "There is a need to develop indicators that the public can feel and that reflect the actual real estate market situation."

Some landmark apartments saw actual transaction price increases exceeding 120% during this period. Jamsil Els in Jamsil-dong, Songpa-gu rose 121.7%, Geonyeong 3rd Apartment in Junggye-dong, Nowon-gu rose 129.2%, Guui Hyundai 2nd Complex in Guui-dong, Gwangjin-gu rose 159.3%, Raemian Crecity in Jeonnong-dong, Dongdaemun-gu rose 131.7%, and e-Pyeonhansesang Sinchon in Bukahyeon-dong, Seodaemun-gu rose 128.6%.

Not only in Seoul but also major apartments in Gyeonggi, Sejong, Gwangju, and Busan rose significantly more than the sale price index and actual transaction price index. For example, in Bundang-gu, Seongnam, Gyeonggi Province, the sale price index was only 24.3 and the actual transaction price index was 57.8, but the actual transaction price increase rate for Pangyo Prugio Granble in Baekhyeon-dong reached 98.2%. Similarly, in Yeongtong-gu, Suwon, Gyeonggi Province, the sale price index was 31.3 and the actual transaction price index was 34.5, but the actual transaction price increase rate for Jayeon & Hillstate in Iui-dong reached 120%.

In Sejong City as well, the sale price index was only 18.8 and the actual transaction price index was 37.6, but the actual transaction price increase rate for Gajae Village 5th Complex Hyundai Emco Town in Jongchon-dong was confirmed at 141.9%.

Song criticized, "The Ministry of Land, Infrastructure and Transport's explanation that Seoul house prices rose by 11% and Seoul apartment prices by 14% has been exposed as a blatant lie," adding, "The majority of people dreaming of owning a home base their standards on newly built apartments with many units and high preference where transactions are active, but the sale price index and actual transaction price index from the Ministry and the Appraisal Board do not reflect the public's perspective and preferences."