[Report] "When I open my eyes, prices jump 100 million won, so buyers don't even come to see houses"… Seoul Buyers Disappear

Visited Guro, Geumcheon, Nowon, Gangdong, and Mapo Sites
Apartment Complexes See Decreased Buyer Demand... Transactions Decline
"Selling and Buying Price Gaps Widen... No Calls Coming In"
With High Price Outlook and Loan Restrictions, Buyers Hold Back

"The gap between the selling and buying prices is too wide, so no transactions are happening. The number of people wanting to buy houses has sharply decreased." (An official from A Real Estate Agency in Guro-dong, Seoul)

"These days, almost no one comes to look at houses... With loans being blocked, how many people would be willing to buy a house at this price?" (An official from B Real Estate Agency in Junggye-dong, Seoul)

The housing sales market in the outskirts of Seoul is freezing solid. On the surface, asking prices have still risen, but due to the government's tightened loan regulations cutting off funding and resistance spreading because of the sharply increased prices, the buying momentum has rapidly weakened. Some even suggest that the housing prices, which had soared to unprecedented heights, have reached a turning point and are beginning to decline.

On the 19th, Asia Economy conducted on-site interviews with real estate agents in outer districts such as Nowon, Geumcheon, and Guro-gu, as well as areas around Mapo and Gangdong-gu in Seoul, confirming that regardless of apartment complexes, most are experiencing a 'transaction freeze' due to decreased buying interest.

The head of A Real Estate Agency near Guro Jugong 1st Complex in Guro-gu said, "I expected many inquiries about buying due to the special reconstruction benefits recently, but since late last week, not a single call has come in," adding, "Prices have risen about 200 million KRW compared to early this year, so the atmosphere is that people can't buy at this price." This apartment complex has over 1,400 households, but only four actual transactions have occurred since last month.

The head of B Real Estate Agency near Junggye Green in Junggye-dong, Nowon-gu, said, "Nowon-gu can no longer be considered a mid-to-low price area," emphasizing, "The media says people in their 20s and 30s are buying houses by 'younggeul' (borrowing to the max), but that's not really the case these days. It's practically a transaction cliff."

The head of C Real Estate Agency near Jugong 1st Complex in nearby Sanggye-dong also said, "Last year, there were still many people looking, but this year everyone just says it's too expensive," adding, "This month, there hasn't been a single buying inquiry, so we're almost idle." In fact, when the reporter visited real estate offices directly, there were almost no inquiries by phone either.

According to frontline real estate offices, the buying momentum has become unsustainable because asking prices have surged by more than 100 million KRW in just a few months due to expectations of rising house prices. The head of D Real Estate Agency in Guro-gu said, "If a house sells for 1 billion KRW, the next price should be around 1.05 billion KRW, but these days, they are immediately asking for 1.1 or 1.2 billion KRW," adding, "However, among homeowners, expectations for further price increases remain, so they are not lowering their asking prices."

The head of E Real Estate Agency in Gasan-dong, Geumcheon-gu, explained, "Compared to the beginning of the year, transactions have dropped to 20-30%," adding, "There is still some demand for gap investment involving jeonse (long-term deposit lease), but even that is not leading to transactions because people expect prices to stagnate."

Other than the outskirts, buying momentum has also frozen in other areas. The head of F Real Estate Agency near Godeok Xi in Sangil-dong, Gangdong-gu, said, "Even the asking prices for small-sized units exceed 1.5 billion KRW, and since loans are completely unavailable, buyers feel burdened and can't even think about buying."

Ko Jong-wan, head of the Korea Asset Management Research Institute, said, "After a rapid price surge, a pause usually occurs, and we are currently in such a phase," adding, "The turning point is imminent."