Transaction Cliff Continues... Seoul Apartment Prices Decline for 11 Consecutive Weeks

The number of districts in Seoul where the average apartment sale price exceeds 50 million KRW per 3.3㎡ has more than doubled in one year. As of November last year, only Gangnam-gu, Seocho-gu, and Songpa-gu among the 25 districts in Seoul had average apartment sale prices exceeding 50 million KRW per 3.3㎡, but last month, Yongsan-gu, Seongdong-gu, Mapo-gu, and Gwangjin-gu were added, making a total of seven districts. The photo shows the view of Seoul apartments from 63 Square. Photo by Hyunmin Kim kimhyun81@

[Asia Economy Reporter Kim Min-young] Seoul apartment prices fell at the largest rate in 3 years and 4 months, continuing a decline for 11 consecutive weeks. This is the result of a combination of factors including interest rate hikes, concerns about an economic recession, and a slowdown in real estate transactions.

According to the Korea Real Estate Board on the 13th, as of the 8th, Seoul apartment prices dropped 0.08% compared to the previous week, widening the decline from last week (-0.07%). This is the largest drop since April 1, 2019 (-0.08%), marking the biggest decline in 3 years and 4 months. The metropolitan area (-0.09% → -0.1%) also saw an expanded decline, recording the largest drop since April 22, 2019 (-0.1%) in 3 years and 4 months. Despite the government's plan to ease capital gains tax, buying demand appears to have weakened due to interest rate hikes and recession concerns.

In Seoul, among the 25 districts, Yongsan-gu and Seocho-gu remained flat (0%), while the other 23 districts declined. Outer areas such as Nowon-gu (-0.15% → -0.2%), Dobong-gu (-0.15% → -0.18%), and Eunpyeong-gu (-0.14% → -0.15%) saw an expanded decline. Gangnam-gu fell 0.02% again this week following last week, and Songpa-gu’s decline widened from 0.05% to 0.06%.

The Real Estate Board explained, "In Seoul, market concerns that housing prices will continue to fall for the time being, along with the summer vacation season, have led to a quiet market with fewer purchase inquiries and decreased transactions, resulting in a wider decline."

Specifically, Nowon-gu saw declines mainly in Sanggye, Junggye, and Wolgye-dong; Dobong-gu mainly in Chang-dong; Songpa-gu mainly in large complexes in Jamsil and Sincheon-dong; Gangseo-gu (-0.05%) mainly in Naebalsan-dong; and Yeongdeungpo-gu (-0.05%) mainly in Daerim-dong.

In Gyeonggi-do, apartment prices fell everywhere except Yeoju (0.06%) and Icheon (0.05%). The declines were significant in Osan (-0.24%), Gwangju (-0.23%), Uiwang (-0.22%), and Siheung (-0.2%).