"I Can't Afford to Fall Behind": Non-Seoul Residents Only Buy "Seoul Apartments"

Proportion of Seoul Apartment Purchases by Non-Local Investors Rises
Share of Collective Building Transactions Declines This Year

Apartment complex in Seoul. Photo by Yonhap News

Investors from regions outside Seoul have begun purchasing apartments in Seoul. This trend is being analyzed as a move to secure a "smart single property" amid surging housing prices in the capital.

According to apartment transaction data by buyer residency from the Korea Real Estate Board as of April 26, the proportion of apartment purchases in Seoul by investors residing outside the city stood at 22.7%. This represents a 2.7 percentage point increase compared to 20% in the previous month.

As apartment prices in Seoul have soared, the number of non-local investors has increased. Looking at the apartment sales price index, the cumulative increase in Seoul from January to May reached 1.95%. This is an overwhelming growth rate compared to the nationwide change of -0.33% and the greater Seoul metropolitan area’s 0.26%. Even in June, as of the 16th, the apartment sales price change in Seoul was 0.81%, higher than the 0.27% recorded in the greater Seoul area.

These investors are focusing exclusively on apartments. The proportion of investment in collective buildings?including apartments, officetels, row houses, and multiplex houses?has declined. According to the Court Registration Information Plaza, the proportion of non-local applicants for ownership transfer registration (sales) of collective buildings was 21.6%. In January this year, this figure was 28.6%, but it dropped by 7 percentage points in just four months.

Kwon Youngsun, team leader at Shinhan Bank's Real Estate Investment Advisory Center, explained, "Compared to apartments in Seoul, the price growth of multiplex houses or officetels is slower, and there is a lack of demand, making them relatively difficult to sell. From the perspective of regional investors looking at the Seoul real estate market, they consider the outlook for price increases, ease of resale, and sustainability of demand. As a result, the trend of purchasing apartments is likely to continue."