Seoul Apartment Jeonse Listings Plunge 40% in Half a Year
Meanwhile, Sale Listings Surge 30%... "The Landscape Has Changed"
"The jeonse prices have risen quite a bit. It's completely different from the news a few months ago."
Mr. Kim, in his 30s, lives in a three-room villa near Gongdeok Station in Mapo-gu, Seoul. With growing worries about the non-return of the deposit due to reverse jeonse, he plans to move to a nearby apartment jeonse by September, even if it means stretching his budget. However, after visiting several real estate agencies, he became more concerned. Kim said, "The listings I was watching in the low 400 million KRW range have now risen to the mid-500 million KRW range," adding, "I'm also considering other neighborhoods." A real estate agent in Gongdeok-dong said, "As the real estate market gradually revives, homeowners are changing their minds from offering jeonse to selling their homes, which has changed the situation."
In Seoul's apartment market, jeonse listings have plummeted by 40% in six months. This is the opposite of the jeonse market earlier this year, when high interest rates from the U.S. caused a flood of listings due to difficulty finding tenants. Conversely, sales listings have increased by more than 30%. This is interpreted as more homeowners converting their jeonse listings into sales listings following recent interest rate stabilization and real estate regulation easing, which led to a rebound in apartment prices.
According to the real estate big data platform Apartment Real Transaction Price (Asil) on the 18th, as of the previous day, Seoul apartment jeonse listings numbered 32,452, down 21,683 listings (40.1%) from 54,135 six months ago. Seoul jeonse listings have been gradually decreasing since falling to the 40,000 range on February 27 and entering the 30,000 range in May. Conversely, during the same period, sales listings increased by 15,011 listings (29.3%) from 51,163 to 66,174, showing a contrasting trend.
The market attributes the sharp decline in jeonse listings and the surge in sales listings primarily to homeowners' 'change of mind.' Recently, with the base interest rate held steady for four consecutive times and various real estate regulations eased, home prices have been gradually rebounding. As a result, homeowners have withdrawn their listings from the jeonse market and started putting them back on the market for sale.
The phenomenon of listings disappearing despite a decrease in apartment jeonse transaction volume supports this claim. According to the Seoul Real Estate Information Plaza, Seoul apartment jeonse transaction volumes have steadily decreased from 16,211 in March to 13,414 in April, 11,941 in May, and 9,941 in June.
A real estate agency official in Godeok-dong, Gangdong-gu, Seoul, explained, "The Godeok Gracious apartment with a 59㎡ exclusive area, which dropped to the 1 billion KRW range earlier this year, has risen to the 1.2 billion KRW range. As the situation improves, homeowners who planned to wait by offering jeonse are now thinking 'this is the time' and putting their homes on the market." In fact, apartment sales listings in Gangdong-gu have increased by 33% from 2,626 six months ago to 3,494.
Yeo Kyung-hee, senior researcher at Real Estate R114, explained, "Price increases and listing growth are occurring mainly in areas with generally high prices and residential preference such as Gangdong, Songpa, Mapo, and Yangcheon in Seoul." She added, "However, the transaction atmosphere varies by region, and mid-to-low price areas are gradually joining the trend, so the number of rebound areas is expected to increase."
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