Is the Rise in Housing Prices Easing?... Increase in Declining Transactions, Decrease in Rising Transactions

194 Apartment Transactions in Seoul This Year
59% Increased, 35% Decreased

70% Increased, 25% Decreased in Second Half of Last Year
Contrasting Market Conditions

View of Seoul apartments from the 63 Building observatory./Photo by Hyunmin Kim kimhyun81@

[Asia Economy Reporter Lee Chun-hee] Since the beginning of the new year, the number of transactions within the same complex in Seoul where prices have fallen compared to the previous transaction has increased.

According to the 'Seoul Apartment Actual Transaction Trends' submitted by the Ministry of Land, Infrastructure and Transport to Park Sang-hyuk, a member of the Democratic Party of Korea, among 194 apartment sales transactions in Seoul this year up to the 14th (based on contract date), 114 transactions (58.8%) showed price increases compared to the previous transaction, while 68 transactions (35.1%) showed price decreases. This statistic was extracted from cases where transactions occurred within the same complex within the past three months.

Compared to last month’s 2,334 transactions, where 73.0% (1,704 transactions) showed price increases and 23.4% (546 transactions) showed price decreases, the proportion of price-increasing transactions dropped by 14.2 percentage points, and the proportion of price-decreasing transactions rose by 11.7 percentage points.

In the second half of last year, the proportions of price-increasing and price-decreasing transactions in Seoul showed a consistent pattern. The proportion of price-increasing transactions was around 70%, with ▲September at 73.1%, ▲October at 68.1%, and ▲November at 70.6%. The proportion of price-decreasing transactions was around 25%, with ▲September at 23.0%, ▲October at 27.4%, and ▲November at 25.4%.

Gangnam Songpa Apartment. Photo by Hyunmin Kim kimhyun81@

Price-decreasing transactions were observed throughout Seoul, from the Gangnam 4 districts (Gangnam, Seocho, Songpa, Gangdong-gu) to outer areas such as 'Nodogang' (Nowon, Dobong, Gangbuk-gu).

In Gaepo-dong, Gangnam-gu, a 53㎡ unit in Gaepo Jugong Complex 6 was sold on the 1st of this month for 1.78 billion KRW (3rd floor), which is 20 million KRW lower than the previous highest price of 1.8 billion KRW (3rd floor) in November last year. In Seocho-dong, Seocho-gu, a Ramian Seocho STAGE S 84㎡ unit was sold on the 2nd for 2.34 billion KRW, 60 million KRW lower than last month’s highest price of 2.4 billion KRW (10th floor).

In Donam-dong, Seongbuk-gu, an 80㎡ unit in Dongbu Centreville was sold last month for 917 million KRW (20th floor), but on the 6th of this month, it was sold for 850 million KRW (17th floor), a decrease of 67 million KRW. In Gongneung-dong, Nowon-gu, a 39㎡ unit in Siyoung 3rd Life was contracted on the 6th of this month for 349 million KRW (3rd floor), 21 million KRW lower than last month’s 370 million KRW (6th floor).

Park said, "This is partly a reaction to the excessive rise in house prices, but I believe that government real estate policies such as tax and loan regulations on multi-homeowners are showing some effect." He added, "The government should continue to consistently pursue measures to stabilize house prices while closely monitoring actual transaction trends in the housing market going forward."