Seoul Down 0.02% from Last Week
First Decline in 8 Weeks
Market Hit Expected Due to Reduced Loan Limits
As the government announced a strong lending regulation limiting home mortgage loans in the Seoul metropolitan area and regulated regions to 600 million won, apartment prices in Seoul have shifted to a decline for the first time in eight weeks.
According to Real Estate R114 on July 6, the nationwide apartment sale price in the first week of this month rose by 0.02% compared to the previous week. In contrast, Seoul saw a 0.02% decrease, reversing the previous week's increase of 0.54%. This marks the first time in eight weeks that Seoul apartment sale prices have shown a downward trend, since the third week of May when they fell by 0.05%.
On the 27th, apartment prices in Mapo and Seongdong districts of Seoul rose at the largest rate since related statistics began to be published in 2013. The expectation that Seoul apartment prices will continue to rise is forecasted to sustain the upward trend for the time being. The photo shows a panoramic view of apartment complexes in downtown Seoul as seen from Namsan, Seoul. 2025.06.27 Photo by Dongju Yoon
Gyeonggi and Incheon regions rose by 0.09%, leading the upward trend in the metropolitan area, which increased by 0.03%. The five major metropolitan cities saw a 0.01% rise, while other provinces declined by 0.09%. Of the 17 major cities and provinces nationwide, 10 recorded increases, 2 remained unchanged, and 5 declined, indicating that regions with rising prices were in the majority.
By region, prices fell in Sejong (-0.63%), Ulsan (-0.29%), Gangwon (-0.05%), Jeonbuk (-0.05%), and Seoul (-0.02%). Increases were recorded in Gyeonggi (0.09%), Incheon (0.09%), Daejeon (0.08%), Gyeongnam (0.06%), and Gwangju (0.06%).
The nationwide jeonse (long-term lease) market generally showed an upward trend. In the first week of this month, among the 17 major cities and provinces, jeonse prices rose in 14 regions and fell in 3. The nationwide apartment jeonse price increased by 0.06%, with Seoul up by 0.08%, the metropolitan area by 0.07%, Gyeonggi and Incheon by 0.06%, the five major metropolitan cities by 0.02%, and other provinces by 0.01%.
Analysts say the government's June 27 lending regulation is bringing immediate changes to the Seoul apartment market. A Real Estate R114 official explained, "Last week, the government implemented the June 27 measures, fixing the home mortgage loan limit in the metropolitan area at 600 million won or less. As a result, the rate of change in Seoul, which had been leading the increase, has significantly contracted. Last week, Seoul rose by 0.54%, recording the highest weekly increase this year, but within a week, the market sharply contracted and this week saw a 0.02% decline."
The reduction in loan limits is expected to dampen buying sentiment in the Seoul apartment market. The Real Estate R114 official said, "Based on Real Estate R114 price data, the average price of an apartment in Seoul is 1,464.92 million won. Assuming a loan-to-value (LTV) ratio of 70%, loans exceeding 1 billion won were possible, but due to the new measures, buyers now need an additional 400 million won in cash. In fact, out of 1.71 million apartment units in Seoul, 1.28 million units, or 74%, are affected by the reduced loan limits, and 18 out of the 25 districts are expected to be hit by this liquidity tightening measure."
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