Seoul Apartment Prices Narrow Decline for 2 Consecutive Weeks... "Influenced by Some Rising Transactions"

[Asia Economy Reporter Noh Kyung-jo] Seoul apartment prices have reduced their decline for the second consecutive week. This is attributed to some upward transactions occurring in major complexes amid a buyer-favored market.

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

According to the weekly apartment price trend announced by the Korea Real Estate Board on the 23rd, Seoul apartment prices fell by 0.26% in the third week of February (as of the 20th), a smaller decline compared to the previous week (-0.28%).

The Real Estate Board explained, "Although transactions are mainly urgent sales driven by expectations of further price drops, some upward transactions have occurred due to the government's real estate regulation easing measures at the beginning of the year and the decline in financial sector loan interest rates, resulting in an overall reduction in the rate of decline."

Among Seoul's 25 autonomous districts, Seocho-gu (-0.07%) showed the smallest decline. This was followed by Songpa-gu (-0.13%) and Nowon-gu (-0.16%). By region, the southeastern area including the Gangnam 3 districts (Seocho, Gangnam, Songpa) and Gangdong-gu had the lowest decline rate at 0.18%.

The largest decline was in Geumcheon-gu (-0.54%), where prices fell due to inventory accumulation in large complexes in Siheung and Doksan-dong. Gangseo-gu (-0.44%) saw price drops mainly in Naebalsan, Magok, and Gayang-dong, while Gangbuk-gu (-0.38%) experienced declines centered on large complexes in Mia-dong and older buildings in Beon-dong.

Gyeonggi (-0.55%) and Incheon (-0.36%) also continued their downward trends with reduced declines compared to the previous week. In Gyeonggi, Yeongtong-gu (-0.93%) saw price drops mainly in Maetan, Yeongtong-dong, and major complexes in Gwanggyo New Town, while Hwaseong-si (-0.91%) experienced declines centered on Dongtan New Town and Banwol and Byeongjeom-dong. Hanam-si, which includes Wirye and Misa New Towns, fell by 0.84%. In Incheon, Bupyeong-gu (-0.56%) showed a decline mainly in large complexes in Samsan and Bupyeong-dong, and Seo-gu (-0.44%) experienced a notable decline mainly in Cheongna, Geomam, and Gajeong-dong, affected by new housing supply.

The five major metropolitan cities in the provinces fell by 0.43%. These include Busan (-0.50%), Daegu (-0.54%), Gwangju (-0.30%), and Daejeon and Ulsan (each -0.34%). Sejong fell by 0.80%, maintaining a decline rate within -1% following the previous week's -0.99%.

Nationwide apartment jeonse (long-term lease) prices also fell by 0.63%, a smaller decline compared to the previous week (-0.74%). Among the 17 cities and provinces, Gyeonggi, which was the only region to record a decline over -1%, reduced its decline to -0.90% this week. Jeonse prices in Seoul and Incheon fell by 0.81% and 0.74%, respectively. The five major metropolitan cities in the provinces fell by 0.60%.

The Real Estate Board stated, "With an increase in supply due to new housing completions and a decrease in demand due to concerns over reverse jeonse, a tenant-favored market has formed, and as some urgent sale properties with large declines have been partially absorbed, the rate of decline has somewhat decreased."