One Year Before Law Enforcement, Increase Quadrupled... 'Nodogang' and 'Gangnam 3 Districts' Lead
Gyeonggi and Incheon Rise by 84.62 Million KRW and 45.98 Million KRW Respectively
[Asia Economy Reporter Jo Gang-wook] It has been revealed that the average jeonse price of apartments in Seoul rose by more than 130 million KRW within one year of the implementation of the new lease law. This increase is nearly four times higher than the rise in the previous year.
According to the monthly KB Housing Price Trend report released by KB Kookmin Bank Liv Real Estate on the 27th, the average jeonse price of apartments in Seoul this month was 634.83 million KRW, up 135.62 million KRW from July last year (499.22 million KRW), when the new lease law was enacted.
This is 3.8 times higher compared to the increase of 35.68 million KRW (463.54 million → 499.22 million KRW) during the previous year (July 2019 to July 2020).
The average jeonse price of apartments in Seoul surpassed 300 million KRW in February 2014 (302.5 million KRW), rising from 249.02 million KRW in June 2011 when KB began compiling statistics. It then exceeded 400 million KRW in March 2016 (402.44 million KRW), 500 million KRW in August last year (501.11 million KRW), and 600 million KRW in March this year (606.52 million KRW) consecutively.
It took 2 years and 1 month to rise from 300 million to 400 million KRW, and 4 years and 5 months to go from 400 million to 500 million KRW. However, the time taken to increase from 500 million to 600 million KRW was only 8 months.
In the metropolitan area including Gyeonggi and Incheon, the average apartment jeonse price rose nearly 100 million KRW (96.45 million KRW) from 337.37 million KRW in July last year to 433.82 million KRW this month. Compared to the previous year’s increase of 23.14 million KRW, this is 4.2 times higher, indicating a faster rise than in Seoul.
During the same period, Gyeonggi’s average jeonse price increased by 84.62 million KRW from 269.69 million KRW to 354.30 million KRW, and Incheon’s rose by 45.98 million KRW from 209.61 million KRW to 255.59 million KRW.
The rise in Seoul’s jeonse prices was driven jointly by the ‘Nodogang’ areas, which have relatively affordable jeonse prices, and the Gangnam 3 districts, known for high-priced jeonse.
Within one year of the new lease law’s implementation, Dobong-gu recorded the highest increase in apartment jeonse prices in Seoul, with a rise of 35.4%. Following were Dongdaemun-gu (32.2%), Nowon-gu (31.7%), Songpa-gu (31.4%), and Gangbuk-gu (30.1%), all ranking in the top five. Gwanak-gu (29.6%), Geumcheon-gu (29.2%), Seocho-gu (29.2%), Yongsan-gu (29.1%), and Seongbuk-gu (28.6%) were also among the top ten.
The area with the highest jeonse prices was Gangnam-gu, where the average jeonse price for a 93.62㎡ apartment rose to 1.12394 billion KRW, an increase of 295 million KRW compared to a year ago. Seocho-gu’s average was 1.07831 billion KRW, up 243.9 million KRW, and Songpa-gu’s was 818.52 million KRW, up 195.76 million KRW.
Only four areas in Seoul?Nowon-gu, Dobong-gu, Geumcheon-gu, and Jungnang-gu?had average jeonse prices below 500 million KRW for a 93.62㎡ apartment.
In Nowon-gu, where the average was 370.37 million KRW a year ago, the jeonse price for a 93.62㎡ apartment rose by more than 100 million KRW (117.56 million KRW) to 487.93 million KRW. Dobong-gu increased by 121.54 million KRW (343.20 million → 464.75 million KRW), Geumcheon-gu by 104.36 million KRW (357.14 million → 461.50 million KRW), and Jungnang-gu by 98.66 million KRW (391.33 million → 490.00 million KRW).
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