Seoul Monthly Jeonse and Wolse Supply Forecast: Average 180,000 Households
56,000 Households Released in Gangnam 4 Districts Only
[Asia Economy Reporter Kim Hyemin] It has been revealed that 30% of the jeonse and wolse rental supply to be released in Seoul in the first half of this year is concentrated in the Gangnam 4 districts (Gangnam, Seocho, Songpa, Gangdong). The supply of large apartment complexes moving in is also expected to be four times that of last year, indicating that the oversupply of rental units will continue for the time being. On the other hand, with jeonse and wolse prices continuing to decline, the possibility of a 'Gangnam-originated jeonse shock' is also being raised.
According to the rental supply forecast information from the Seoul Metropolitan Government's jeonse and wolse information portal 'Seoul Jeonse and Wolse Information Mongttang' on the 7th, the average monthly jeonse and wolse supply expected to come out in Seoul during the first half of this year (January to June) was 180,099 households. This supply volume is predicted based on the assumption that all rental contracts will expire and be newly released into the rental market. It includes apartments, multi-family houses, and single-family houses.
By type, jeonse accounted for an average of 116,343 households per month, making up 64.6% of the total. By housing type, apartments were the most numerous, averaging 93,475 households per month. Multi-family houses and single-family houses, which are relatively more difficult to accurately assess market prices and thus have a higher possibility of 'empty jeonse' (kkan-tong jeonse), were 58,100 and 29,425 households respectively.
By region, the supply in the Gangnam 4 districts was overwhelmingly large. The Gangnam 4 districts are expected to have an average monthly supply of 56,048 households, accounting for 31% of the total. The district predicted to have the highest rental supply is Gangnam-gu, with an average of 21,655 households per month, the only one among the 25 autonomous districts to exceed 20,000 households. The supply is expected to gradually increase until June. The total supply reaches 129,987 households, nearly 130,000. Following are Seocho-gu with 14,208 households, Songpa-gu with 13,181 households, and Gangdong-gu with 6,994 households per month. Among these, only the three Gangnam districts exceed 10,000 households monthly. In particular, in Gangnam-gu, Daechi-dong, which leads jeonse and wolse prices, is expected to supply an average of 4,624 rental households per month.
Including the rental supply from large apartment complex move-ins, the rental supply in the Gangnam 4 districts could increase further. According to Real Estate R114, the apartment move-in supply in the Gangnam 4 districts this year is 12,402 households, four times that of last year (3,592 households).
While supply is increasing significantly, if the supply is not absorbed in time, jeonse and wolse prices could fall sharply. According to the real estate big data company 'Apartment Real Transaction Price,' as of this day, the jeonse and wolse supply in Eunma Apartments in Daechi-dong is about 532 households, but due to insufficient demand, cases of jeonse transactions falling by hundreds of millions of won are increasing. For example, a 76㎡ exclusive area signed a new jeonse contract on the 11th of last month for 540 million won, whereas the previous deposit was 700 million won, resulting in a 160 million won decrease in the new contract. On the 6th of last month, a renewal contract for the same size was signed at 610 million won, which was 290 million won lower than the previous deposit of 900 million won.
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