Seoul Apartment Buying Demand Weakens... Apartment Prices Decline for 5 Consecutive Weeks

[Image source=Yonhap News]

[Asia Economy Reporter Kim Min-young] The sentiment for purchasing apartments in Seoul has been shrinking for two consecutive months. As buyers remain cautious due to interest rate hikes, perceptions of peak housing prices, and concerns about an economic recession, apartment prices have also fallen for five consecutive weeks.

According to the weekly apartment supply and demand trend report by the Korea Real Estate Board on the 2nd, the Seoul apartment sales supply-demand index for the fourth week of June (as of the 27th) was 87.0, down 1.1 points from the previous week. This index has been declining for eight consecutive weeks since recording 91.1 on May 2, reflecting expectations of the new government's real estate regulation easing. The sales supply-demand index indicates the balance between demand and supply; a value below the baseline (100) means there are more sellers than buyers. The Seoul apartment sales supply-demand index has remained below the baseline since November 8 last year (100.9).

Reflecting this atmosphere, listings are also accumulating. According to Asil, a real estate big data company, as of the 1st, apartment listings in Seoul increased by 16.2% compared to two months ago. The increase in listings in Seoul is the second highest among all provinces nationwide.

As the buying sentiment continues to weaken, Seoul apartment prices have fallen for five consecutive weeks. According to the weekly apartment price trend, Seoul apartment sale prices this week fell by 0.03% compared to last week. By district, except for Seocho-gu, which rose by 0.02%, and Yongsan, Seongdong, and Gangnam-gu, which remained flat, all other areas continued to decline. Seoul apartment prices have been declining since May 30 (-0.01%), with the rate of decline widening.

The Korea Real Estate Board explained, "The cause is the continued cautious sentiment and shrinking transaction sentiment due to concerns about further interest rate hikes and the impact of accumulated listings."