Silgeochae.com, Gangnam-gu Ranks First for 6 Consecutive Months in Seoul Building Sales Transactions This Year

There is a saying, "the rich get richer and the poor get poorer." It means that the poorer people become even poorer, while those with more wealth become even richer. Let's examine the actual transaction price statistics released by Silgeorae.com regarding this phenomenon occurring in the real estate market, especially in the building sales market.

Seoul consists of 25 districts. Due to various differences in area, population, number of subway stations, and more across districts, the average building sale prices per district vary greatly. Among them, the district with the overwhelmingly highest average building sale price per unit is Gangnam-gu.

[Silgeorae.com]

Over the past 10 years, the average actual transaction price per building sale was 17.04 billion KRW, and in the last 3 years, the average actual transaction price per building was 23.47 billion KRW, showing a price increase of 6.4 billion KRW. Simply put, this means that building sales worth approximately 23.47 billion KRW are transacted monthly in Gangnam-gu.

What is even more important here is that while a large transaction amount might suggest increased investment capital and a lower demand, Gangnam-gu has ranked first in the number of actual building sale transactions from January to June 2014.

Park Jongbok, director of Nahae-yo Academy LLC, stated, “Gangnam is an area where you can experience various environments not found in other regions, so it has been considered a place where investors or the top 1% wealthy people gather for about 30 years,” adding, “I believe this is an effect of a well-balanced harmony between current supply and demand.”

Finally, Director Park warned, “However, it is very risky to look only at this phenomenon and overestimate your asset size, then take on excessive financial loans without analyzing interest to invest in wealthy neighborhoods.”

He advised that rather than aiming for a special regional entry all at once, it is a sound judgment to assume long-term interest rate hikes and real estate downturns and then sequentially choose a strategy that suits oneself.