Seoul Apartment Prices Fall for 16 Consecutive Weeks... Largest Drop in 10 Years

Korea Real Estate Board Apartment Price Trends for the 2nd Week of September

The decline in apartment prices in Seoul has continued for 16 consecutive weeks.

According to the 'Apartment Price Trends for the 2nd Week of September' report by the Korea Real Estate Board on the 15th, Seoul apartment prices fell by 0.16% compared to the previous week (-0.15%), marking a decline for 16 consecutive weeks. This is the largest drop in 9 years and 9 months since December 10, 2012 (-0.17%).

Among the 25 districts in Seoul, Dobong-gu (-0.31%) experienced the largest decrease.

Additionally, the decline was significant in the northeastern and central areas, including Nowon-gu (-0.29%), Seodaemun-gu (-0.27%), Seongbuk-gu (-0.25%), Jung-gu (-0.25%), Jongno-gu (-0.24%), and Mapo-gu (-0.20%).

In the Gangnam area, Gangnam-gu fell by 0.09%, the same as last week, while Seocho-gu (-0.05%) and Songpa-gu (-0.18%) saw an increased rate of decline compared to the previous week.

The Real Estate Board analyzed, "Due to concerns over additional interest rate hikes, buyer sentiment has significantly weakened," adding, "With the Chuseok holiday reducing buying activity, intermittent transactions focused on urgent sales and continued downward adjustments in listing prices have expanded the rate of decline."

Overall, as listings accumulate and interest burdens increase, transaction sentiment has weakened. Gyeonggi-do (-0.21%) saw a slightly smaller decline than last week (-0.22%), while Incheon (-0.29%) maintained a similar level of weakness as the previous week.

Amid this trend, apartment prices in the metropolitan area (-0.20%) and nationwide (-0.16%) showed overall weakness, but the rate of decline eased by 0.01 percentage points (p) compared to last week.

Jeonse (long-term lease) prices also continued to weaken as new demand decreased and renewal contract demand increased.

Seoul apartment jeonse prices fell by 0.12%, a larger drop than last week (-0.11%). Jeonse prices in the metropolitan area (-0.19%) and nationwide (-0.14%) continued to decline, but the rate of decline slightly decreased compared to last week.

The Real Estate Board explained, "Due to increased interest burdens on jeonse loans caused by interest rate hikes, demand for renewal contracts, semi-jeonse, and monthly rent is increasing rather than new jeonse," adding, "In this context, along with falling sale prices, continuous downward adjustments in listing prices have expanded the rate of decline in jeonse prices."