Seoul Metropolitan Area Apartment Market: Jeonse Prices Rise for 9 Consecutive Months, Stimulating Purchase Demand

Seoul and Capital Area Jeonse Prices Rise for 9 Consecutive Months Since July Last Year
Seoul Apartment Sales Transactions Surpass 4,000, Highest in 2 Years and 7 Months

On the 14th, in a real estate-dense shopping district in Songpa-gu, Seoul, apartment listings with price tags are displayed amid the ongoing decline in real estate prices and a transaction freeze. Photo by Kang Jin-hyung aymsdream@

The jeonse prices, a leading indicator of sale prices, have been rising for nine consecutive months, creating an atmosphere where sales transaction volumes are also increasing accordingly. In March, the number of apartment sales transactions in Seoul surpassed 4,000 (4,039 transactions, based on data from the Seoul Real Estate Information Plaza as of April 26), marking the highest level in 2 years and 7 months since August 2021 (4,065 transactions).

On the 27th, Real Estate R114 released a report on the metropolitan area market, stating that considering the rental price nature, which is most sensitive to supply (move-in) volumes, the upward trend in jeonse prices is expected to continue for a considerable period due to the decrease in new apartments in Seoul and the metropolitan area. Driven by this jeonse market atmosphere, the sales market is beginning to absorb urgent sale listings and is expected to soon follow the upward trend.

Seoul apartment sale prices have maintained a flat trend (0.00%) for six consecutive weeks while absorbing urgent sale listings. Both redevelopment and general apartments showed no significant price changes, and new towns as well as Gyeonggi and Incheon also recorded flat prices (0.00%). In individual areas of Seoul, demand has flowed mainly toward urgent sale listings priced below market value, resulting in many places experiencing price drops compared to the previous week. Nine districts, including Gwanak (-0.03%), Dobong (-0.03%), and Nowon (-0.02%), saw declines, while Yangcheon-gu was the only district to rise by 0.01%.

In individual new town areas, Pyeongchon (-0.02%), Ilsan (-0.01%), and Sanbon (-0.01%) declined, whereas Dongtan, benefiting from the GTX line opening, rose by 0.04%. In individual areas of Gyeonggi and Incheon, Icheon fell by 0.01%, while Hwaseong (0.02%) and Uijeongbu (0.01%) increased, with the remaining areas remaining flat (0.00%).

The jeonse market is led by Seoul’s upward momentum and is spreading throughout the metropolitan area, including new towns and Gyeonggi-Incheon. Seoul, Gyeonggi, and Incheon rose by 0.01%, while new towns remained flat (0.00%). Shortages of jeonse properties (excess demand) continued mainly in individual areas and apartment complexes.

In individual Seoul districts, 13 districts including Gangdong (0.05%), Mapo (0.03%), Gwangjin (0.03%), Gwanak (0.03%), Songpa (0.02%), and Dobong (0.02%) saw increases, while Yangcheon was the only district to fall by 0.02%. In individual new town areas, Ilsan rose by 0.01%, and all other areas remained flat (0.00%). In individual Gyeonggi-Incheon areas, rises were seen in Anseong (0.09%), Yangju (0.04%), Ansan (0.04%), Incheon (0.03%), Uijeongbu (0.02%), Suwon (0.02%), Goyang (0.02%), and Gwangmyeong (0.01%).

A representative from Real Estate R114 stated, "As record-high prices are gradually emerging in major areas of Seoul, the leading region, Seoul apartment sales transactions have surpassed 4,000 for the first time in 2 years and 7 months," adding, "This can be interpreted as a sign that urgent sale listings accumulated over the past two years are beginning to be gradually absorbed."

They continued, "From the perspective of actual buyers, the continuously rising monthly rent and jeonse prices over the past year, along with the increased burden of new apartment sale prices, are reducing housing options. It is expected that buyers will start switching from the monthly rent and jeonse market to sales, focusing on affordable urgent sale listings in the metropolitan area," they forecasted.