As Soon as the Lee Administration Took Office, Seoul Apartment Prices Surpassed Moon-Era Peaks Despite Regulations [Real Estate AtoZ]

Record-Highs Accelerate in Han River Belt Districts Like Seongdong, Songpa, Seocho, and Gangnam
11 Seoul Districts Set New Peaks, But Citywide Index Still Below Previous High
Gwacheon and Bundang Surpass Previous Highs, Trend Spreads Across Grea

Since the inauguration of the Lee Jaemyung administration, there has been a surge in regions surpassing the previous peak apartment prices recorded during the Moon Jae-in administration (2017-2022). This trend of setting new highs in housing prices is spreading from Seoul to key areas in the metropolitan region and even to some small and medium-sized cities in the provinces.

Most of the Han River Belt surpassed the peak apartment prices during the Moon Jae-in administration. Yonhap News.

According to an analysis of the apartment sales price index by the Korea Real Estate Board as of October 9, eleven districts in Seoul have all exceeded their previous peaks set during the Moon administration. These districts include Gangnam, Seocho, Songpa, Yongsan, Seongdong, Mapo, Gwangjin, Yangcheon, Gangdong, Yeongdeungpo, and Dongjak. The sales price index represents the percentage change in prices compared to a reference point, which is set at 100 as of March 31 of this year.

By district, Seongdong saw its index rise from the previous peak of 93.88 in January 2022 to 110.26 in the fifth week of September this year, marking a 17.45% increase. Songpa also climbed from its January 2022 peak of 93.99 to 109.70, up 16.71%. Seocho rose from its August 2022 peak of 91.56 to 107.66, an increase of 17.58%, while Gangnam jumped from its June 2022 peak of 94.04 to 107.05, a 13.83% rise.

Yongsan increased by 9.15%, from 97.81 in June 2022 to 106.76 now, and Mapo rose by 6.68%, from 101.29 in January 2022 to 108.06. Gangdong (from 102.75 to 106.43, +3.58%), Gwangjin (from 101.38 to 106.21, +4.76%), Yangcheon (from 100.73 to 106.46, +5.69%), Yeongdeungpo (from 102.94 to 105.44, +2.43%), and Dongjak (from 103.49 to 104.98, +1.44%) have also all surpassed their previous peaks.

As a result, out of the 11 districts adjacent to the Han River, 10 have exceeded their previous highs. Gangseo is the only Han River-adjacent district that has not surpassed its previous peak. The current sales price index for Gangseo stands at 102.30, which is 7.9% lower than its previous peak of 111.09 recorded in January 2022.

The overall sales price index for Seoul is 104.47, just shy of the peak of 104.63 reached on January 17, 2022, during the Moon administration. This is mainly due to the slower recovery in outlying areas such as Nowon, Dobong, Gangbuk (collectively known as 'Nodogang'), and Geumcheon, Guro, Gwanak (collectively known as 'Geumgwanggu'). In these districts, apartment prices are still more than 10% below their previous peaks.

In Gyeonggi Province, Gwacheon and Bundang District in Seongnam have both surpassed their previous highs. Gwacheon rose from 102.17 in January 2022 to 108.92 in the fifth week of September this year, up 6.61%. Bundang District climbed from 102.96 in June 2022 to 109.47, an increase of 6.32%.

In the provinces, a total of eight regions have surpassed their previous peaks. Sangju in North Gyeongsang Province saw the highest nationwide increase, jumping 20.71% from its December 2021 peak of 85.41 to 103.10 this year. Yeongju (from 90.35 to 102.61, +13.57%) and Mungyeong (from 92.73 to 103.74, +11.87%) also posted double-digit increases. Donghae in Gangwon (from 93.71 to 100.24, +6.97%) and Nonsan in South Chungcheong (from 95.99 to 101.08, +5.30%) also set new highs. Wansan District (from 102.06 to 102.22, +0.16%) and Deokjin District (from 101.98 to 102.36, +0.37%) in Jeonju, North Jeolla Province, as well as Jecheon in North Chungcheong (from 100.17 to 100.36, +0.19%), have also marginally surpassed their previous peaks.

The rebound in the provinces is primarily due to a shortage of supply. Sangju has had no new housing supply for four consecutive years since 2022, and Jeonju, with a population of 600,000, has only 277 new units supplied this year, effectively creating a supply vacuum. Inland cities in North Gyeongsang Province are also benefiting from the opening of new rail lines such as the Jungbu Inland Line and the Jungang Line, which is further fueling price increases.

Ham Youngjin, head of the Real Estate Research Lab at Woori Bank, stated, "Recently, districts with a high proportion of record-high transactions include Seongdong, Gwangjin, Gangdong, and Mapo, indicating that buyer sentiment is concentrating around the Han River Belt. There are growing signs of overheating in areas adjacent to the Han River, raising the possibility of additional regulations in the future." He added that the likelihood of new regulations being introduced after the Chuseok holiday is high.

On the other hand, the rise in some provincial regions remains questionable. Yang Jiyeong, a senior advisor at Shinhan Premier Pathfinder, commented, "The provincial market is driven by real demand, and unless policies support this, it may be difficult for the upward trend to continue in the long term." She emphasized, "Improvements in residential conditions and effective local housing policies are needed for the upward trend to be sustained."