Seoul Apartment Prices Fall for 31 Consecutive Weeks... "Concerns Over Further Decline Persist"

Record Largest Drop... 경기 and Incheon Decline Widen
Sejong Records Largest Drop Nationwide for 4 Consecutive Weeks Among Cities and Provinces

View of apartment complexes from Seoul Sky, the observation deck of Lotte World Tower in Songpa-gu, Seoul / Photo by Yonhap News

[Asia Economy Reporter Noh Kyung-jo] Apartment prices in Seoul continued their decline for the 31st consecutive week, with the drop widening. In Incheon and Sejong, prices fell by more than 1% for over three weeks due to weakened transaction sentiment and persistent inventory backlog.

According to the nationwide weekly apartment price trend for the fourth week of December (as of the 26th) released by the Korea Real Estate Board on the 29th, apartment prices in Seoul fell by 0.74%, marking the largest drop since the price survey began in May 2012. The downward trend has continued for 31 consecutive weeks since the end of May.

The Real Estate Board stated, "With buyer sentiment severely weakened, some direct transactions and intermittent urgent sales have lowered the expected purchase prices of waiting buyers, leading to ongoing concerns about further declines."

By district, Jung-gu saw the largest drop at -1.24%, centered around major complexes in Sindang-dong, Chungmuro, and Hoehyeon-dong. Following were Dobong-gu (-1.21%), Nowon-gu (-1.20%), Mapo-gu (-1.09%), and Seongbuk-gu (-1.06%).

In the Gangnam area, Dongjak-gu (-0.73%) declined mainly in major complexes in Daebang, Sadang, and Sangdo-dong, while Yeongdeungpo-gu (-0.72%), Gwanak-gu (-0.60%), and Gangseo-gu (-0.60%) also continued their downward trends. Among the Gangnam 3 districts (Gangnam, Seocho, Songpa), Songpa-gu (-0.49%) reduced its decline compared to the previous week (-0.75%), but Seocho-gu (-0.55%) saw an increased drop.

Gyeonggi Province (-0.99%) also experienced a wider decline than the previous week. Icheon-si (-2.48%) fell due to a contraction in local infrastructure projects, and Yangju-si (-1.99%) dropped mainly in areas affected by new housing supply.

In Incheon (-1.18%), Yeonsu-gu (-1.69%) experienced the largest decline. The falling areas expanded to Songdo New Town and nearby Yeonsu and Dongchun-dong. Seo-gu (-1.30%) declined mainly in major complexes in Cheongna, Majon, and Geomam-dong, while Gyeyang-gu (-1.21%) saw price drops in established and small-to-medium complexes around Yongjong, Jakjeon, and Byeongbang-dong.

In Sejong City, prices fell by 1.68%, mainly in Dajeong and Saerom-dong. It recorded the largest drop for four consecutive weeks among all cities and provinces nationwide.

The jeonse (long-term lease) market situation is no different. With expectations of continued interest rate hikes, a tenant-favorable market has formed, and urgent sales have led to further declines, gradually increasing the drop.

Nationally, prices fell by 0.92%, widening the decline from the previous week (-0.90%). The metropolitan area (-1.24%) and Seoul (-1.22%) also set new records for the largest drops since the Real Estate Board began its survey. Gyeonggi Province and Incheon fell by 1.25% and 1.28%, respectively. In the provinces, Sejong (-1.72%), Daegu (-1.07%), Busan (-0.77%), and Gyeongnam (-0.68%) experienced significant declines in that order.

The Real Estate Board said, "Due to mid- to long-term waiting supply and the impact of the declining sales market, jeonse prices continue to fall."