"Last-Minute Rush"…Seoul Weekly Apartment Prices See Sharpest Increase [Real Estate AtoZ]

Korea Real Estate Board's Weekly Apartment Price Trends for the Third Week of October
Largest Weekly Increase Since 2012 When Statistics Began

Apartment prices in Seoul have recorded the sharpest weekly increase since related statistics began being compiled in 2012. Analysts attribute this to a surge in last-minute demand ahead of new government measures, which will soon classify all of Seoul and neighboring Gyeonggi Province municipalities as regulated areas.

According to weekly apartment price trend data released by the Korea Real Estate Board on October 23, apartment prices in Seoul rose by 0.50% in the third week of October compared to the previous week. The previously announced increase was 0.54%, but that figure covered a two-week cumulative period due to the Chuseok holiday. Public institutions have been releasing weekly apartment price trend data since May 2012.

This upward trend surpasses even the heated market conditions of September 2018. At that time, despite government measures such as increased capital gains taxes for owners of multiple homes, few properties were put on the market. Instead, the government's strong policies triggered a rush of buyers, causing apartment prices to soar in a short period. The weekly increases during that period were approximately 0.45% (August 27, 2018), 0.47% (September 3), and 0.45% (September 10). After several weeks of steep increases, the market cooled following the September 13 policy measures.

This time, the steep rise in apartment prices is largely attributed to last-minute demand as all of Seoul has been designated as a regulated area, including adjustment zones, speculative overheating districts, and land transaction permit zones. Under the October 15 housing market stabilization measures, regulations for speculative overheating districts and other regulated areas took effect on October 16, while land transaction permit zones were implemented from October 20. In these permit zones, purchasing an apartment requires local government approval and the buyer must actually reside in the property.

View of an apartment complex from Namsan Mountain in Seoul. Photo by Yonhap News Agency

By region, Gwangjin-gu in Seoul saw a 1.29% increase in just one week. Seongdong-gu also rose by 1.25%. If this pace were maintained annually, it would exceed 60%. Gangdong-gu (1.12%), Yangcheon-gu (0.96%), Jung-gu (0.93%), and Mapo-gu (0.92%) also recorded significant increases. Among the newly regulated areas, Bundang in Seongnam surged by 1.78%, Gwacheon by 1.48%, and Gwangmyeong by 0.76%.

The Korea Real Estate Board explained, "Across Seoul, prices rose as inquiries and transactions increased, particularly in large complexes, areas near subway stations, and preferred or redevelopment-targeted complexes with favorable residential conditions, leading to higher-priced transactions being concluded."

While apartment prices in some areas of Seoul and neighboring Gyeonggi Province soared, prices in regional areas remained unchanged for the fourth consecutive week. Nationwide, the increase was centered around Seoul and the greater metropolitan area, with prices rising by 0.12%.