The Seoul real estate market has halted its 40-week upward trend and has experienced a stable trend for the past three weeks. This has led to analyses indicating that the downturn in areas outside of Seoul, which had seen concentrated demand due to 'young-gol,' has begun.
According to the Korea Real Estate Board on the 21st, the average apartment price in Seoul for the second week of January (as of the 13th) recorded a stable rate (0.00%). After the 40-week upward trend ended on the 2nd, it has been stable for three consecutive weeks.
In particular, the northeastern region (-0.02%) and southwestern region (-0.01%), considered outskirts of Seoul, have shifted from stability last week to decline this week. In the northeastern region, the declines in individual districts were -0.04% in Dobong and Jungnang districts, -0.03% in Nowon district, and -0.02% in Gangbuk, Dongdaemun, and Seongbuk districts. The southwestern region recorded declines of -0.04% in Guro district, -0.03% in Dongjak district, and -0.02% in Gwanak and Geumcheon districts.
Actual transaction prices are also displaying a downward trend. According to the Ministry of Land, Infrastructure and Transport's public transaction price disclosure system, the 84㎡ unit of 'Hyundai Apartment' in Wolgye-dong, Nowon district, was traded for 600 million won on the 11th, a decrease of more than 200 million won compared to the 817 million won transaction in September of last year. The 41㎡ unit in Sangye-jugong Complex 7, Nowon district, changed hands for 510 million won in July of last year, but was traded for 475 million won in January of this year, marking a 35 million won drop.
The 70㎡ unit of Hyundai Apartment in Ssangmun-dong, Dobong district, was traded for 450 million won in November of last year, down about 50 million won from the 507 million won transaction in September of last year.
In the southwestern region, the 84㎡ unit of 'Gwanak Dream Town' in Bongcheon-dong, Gwanak district, was traded for 860 million to 880 million won last month, down by a maximum of 100 million won compared to the transaction price in November of last year (900 million to 960 million won).
The 84㎡ unit of 'Lotte Castle Gold Park 1st' in Doksan-dong, which is considered the primary apartment in Geumcheon district, was traded for 1.08 billion won in November of last year, a decrease of 90 million won compared to 1.17 billion won in August.
According to the Seoul real estate information plaza, the average transaction price for apartments in January so far is 1.05918 billion won, down 92.98 million won from the previous month (1.15216 billion won).
According to local real estate agencies, there is a reaction indicating that transactions have not been taking place since the implementation of lending regulations in the second half of the year. An official at an agency in Sangye-dong, Nowon district, noted, "There have been almost no transactions except for urgent sales where prices have been significantly lowered," adding that, "Despite the recent decline in housing prices, homeowners have not lowered their asking prices yet."
A representative from a real estate agency in Bongcheon-dong, Gwanak district, stated, "Only inquiries are occasionally made about newly built complexes that are less than 10 years old; there are no inquiries about older buildings," and pointed out that, "People living in jeonse are postponing home purchases due to loan restrictions and renewing their jeonse contracts instead, so jeonse listings are not appearing often."
Experts have forecasted that the downward trend will continue this year due to political uncertainties, including the impeachment process, and lending regulations. Jeon Jin-hyung, a professor at Kwangwoon University’s real estate law department, stated, "The downturn began in the outskirts where buying pressure is weak," and noted, "While interest rate declines may help activate the market, the increased lending regulations prevent consumers from making moves. Seoul is likely to gradually decline as well, except for the Gangnam area."
Yoon Soo-min, a real estate specialist at NH Nonghyup Bank, commented, "Lending regulations have had a significant impact on the decline of real estate in the outskirts of Seoul," adding, "The Gangnam real estate market has shown some revitalization in transactions, but for that warmth to reach the outskirts, it will likely take until the second half of this year."