Capital Region Apartment Prices Rise Further... 2·4 Measures' 'Housing Price Stability' Still Unseen

Korea Real Estate Board Weekly Apartment Prices for the Fourth Week of February
Seoul Metropolitan Area Apartment Prices Increase from 0.30% to 0.31%
Three Weeks After 2·4 Measures Announcement, Housing Prices Still Unstable
Jeonse Prices Unchanged from Previous Week... Seoul's Increase Rate Shrinks

Apartment complexes in downtown Seoul as seen from 63 Square, Yeongdeungpo-gu, Seoul (Photo by Yonhap News)

[Asia Economy Reporter Moon Jiwon] After the government's announcement of the 2.4 Housing Supply Plan, the rate of increase in apartment prices in the Seoul metropolitan area, which had slowed down, expanded again this week. The buying demand for reconstruction complexes in Seoul increased, boosting house prices in the Gangnam area, and Incheon and Gyeonggi Province also continued their upward trend. Although three weeks have passed since the 2.4 Plan was announced, it is interpreted that there is still no clear effect on stabilizing house prices.

According to the weekly apartment price trend for the fourth week of February announced by the Korea Real Estate Board on the 25th, as of the 22nd, apartment prices nationwide rose by 0.25%, the same as the previous week. After recording a 0.29% increase in the fourth week of last month, the rate of increase had been decreasing for three consecutive weeks but stopped the downward trend this week.

In the Seoul metropolitan area, the apartment price increase rate slightly expanded from 0.30% to 0.31%. After the government announced a supply plan on the 4th to supply 830,000 households nationwide, the weekly increase rate showed some hesitation but expanded again after just one week.

Seoul recorded the same 0.08% increase as last week. Seoul also showed a 0.10% increase in the first week of this month, then the rate of increase shrank for two consecutive weeks but remained flat this week.

In Seoul, while prices in the Gangbuk area slightly slowed, the rate of increase grew in the Gangnam area, where major reconstruction complexes are concentrated. The Real Estate Board explained, "After the announcement of the 2.4 Supply Plan, the Gangbuk area generally showed a wait-and-see stance with the rate of increase maintained or reduced, while the Gangnam area saw an expanded rate of increase due to reconstruction expectations after the Lunar New Year holiday."

In fact, Seocho-gu (0.08%→0.11%) saw an expanded rate of increase mainly in reconstruction and new buildings in Banpo and Jamwon-dong, and Gangnam-gu (0.09%→0.10%) also saw a larger increase mainly in reconstruction in Apgujeong-dong and large-sized units in Irwon-dong. Songpa-gu (0.10%→0.10%) rose mainly in Sincheon and Jamsil-dong, and Gangdong-gu (0.06%→0.06%) rose mainly in Gil and Myeongil-dong.

Additionally, Yangcheon-gu (0.09%→0.11%), where expectations for reconstruction in Mok-dong and Sinjeong-dong are high, rose significantly, and Mapo-gu (0.11%) also attracted buying demand centered on the Sangam-dong station area with development prospects and reconstruction. Dobong-gu (0.09%) saw concentrated buying demand in older buildings in Ssangmun-dong and the Chang-dong station area with transportation benefits. On the other hand, Jongno-gu rose only 0.01% compared to the previous week.

In the metropolitan area, only Incheon saw the apartment price increase rate expand from 0.34% to 0.39%. Yeonsu-gu (0.55%) rose mainly in older buildings in Cheonghak, Yeonsu, and Dongchun-dong, which have relatively low price levels, and Seo-gu (0.53%) rose mainly in areas near Geomdan New Town, where expectations for improved living conditions are high.

Gyeonggi Province rose 0.42%, the same as the previous week, with large increases in areas such as Uiwang-si (0.92%), Ansan-si (0.80%), Uijeongbu-si (0.70%), and Namyangju-si (0.71%). Uiwang-si rose mainly near the GTX-C line in Songnae and Jihaeng-dong, and Namyangju-si rose mainly in non-regulated areas such as Hwado-eup.

The provinces also rose 0.20% this week, showing a situation similar to last week. By region, Daegu (0.44%), Daejeon (0.41%), Busan (0.25%), and Jeju (0.23%) rose, while Jeonnam (-0.04%) declined.

Sejong City saw its apartment price increase rate expand from 0.16% to 0.19%. The Real Estate Board explained, "Some mid-to-low price complexes in Jochiwon-eup and areas centered on Geumnam-myeon showed an upward trend, increasing the rate of increase compared to last week."

Apartment complexes in downtown Seoul as seen from 63 Square, Yeongdeungpo-gu, Seoul (Photo by Yonhap News)

The rate of increase in apartment jeonse (long-term lease) prices was similar to or slightly reduced compared to last week.

In Seoul, jeonse prices are rising overall due to a continued shortage of listings, but the rate of increase shrank from 0.08% to 0.07%. The Real Estate Board analyzed, "As moving demand during the school vacation period ended and the number of move-in units increased, listings increased mainly in complexes that had high prices and high rates of increase, reducing the rate of increase compared to the previous week."

The Gangnam 4 districts?Gangnam, Seocho, Songpa (0.05%), and Gangdong (0.03%)?showed relatively low jeonse price increases, while Seongbuk-gu (0.13%), Eunpyeong-gu (0.11%), Nowon-gu (0.11%), Seongdong-gu (0.10%), Gwanak-gu (0.09%), and Guro-gu (0.08%) saw significant jeonse price increases.

In Incheon, where apartment prices increased, jeonse prices also rose 0.32% this week, expanding from 0.24% last week. Jung-gu (0.92%) saw a large increase in jeonse prices in new buildings in Yeongjong New Town, and Namdong-gu (0.46%) and Seo-gu (0.45%) also saw large increases in mid-to-low price complexes.

In Gyeonggi Province (0.23%→0.21%), the rate of increase in jeonse prices slowed, but Dongducheon-si (0.56%), Namyangju-si (0.54%), Siheung-si (0.44%), Pyeongtaek-si (0.42%), and Uijeongbu-si (0.42%) continued to experience a shortage of listings.

Sejong City (0.48%→0.40%) saw jeonse prices rise in Jochiwon-eup and Dodam and Boram-dong in the Happy City area, but the rate of increase shrank due to an increase in new move-in units.