Last month, the ratio of jeonse prices to apartment sales in Seoul's Gangnam area (jeonse price ratio) recorded the lowest in history. This is because apartment sales prices in the Gangnam area rose significantly compared to jeonse prices during the land transaction permit area lift period.
According to KB Kookmin Bank, last month, the jeonse price ratio was 53.52% compared to apartment sales prices in Seoul. This is the lowest in 11 months since 53.43% in May last year.
The drop in the jeonse price ratio for Seoul apartments is attributed to the Gangnam area. Last month, the jeonse price ratio for apartments in Gangnam-gu was 40.7%, the lowest since KB Kookmin Bank began collecting district statistics in April 2013 (50.1%). Additionally, Songpa-gu recorded 43.1% and Gangdong-gu recorded 50.0%, both of which are also the lowest jeonse price ratios on record. Seocho-gu had a 45.4% jeonse price ratio, the lowest in 1 year and 7 months since September 2023 (45.2%).
This is in contrast to some northern regions such as Nowon-gu (54.6%), Dobong-gu (57.8%), Eunpyeong-gu (60.9%), and Geumcheon-gu (62.2%), where the jeonse price ratios in April increased compared to the previous month.
The drop in the jeonse price ratio in the Gangnam area to the lowest level occurred because apartment prices in Gangnam rose significantly around the February lift of Seoul's "Jamsamdaecheong (Jamsil, Samsung, Daechi, and Cheongdam-dong)" land transaction permit area.
According to KB Kookmin Bank statistics, the rate of increase in apartment prices in Seoul rose by 0.06% in February this year, but after the influence of the land transaction permit area lift in mid-February, it jumped to 0.65% in March and further increased to 0.98% in April.
In contrast, the jeonse prices rose from 0.03% in February to 0.16% in March, and then to 0.27% in April, though the increase is lower compared to the sales prices. In the directly benefited areas of Gangnam-gu and Songpa-gu, the sales prices increased by 3.18% and 1.80% respectively in April, while the increase rates of jeonse prices were only 0.39% and 0.49%, significantly lagging behind the sales prices.
Some northern areas that are benefiting from the land transaction permit lifts and expanded designations have also seen declines in their jeonse price ratios. The jeonse price ratio in Seongdong-gu was 50.58%, surpassing the previous low of 50.64% recorded in April 2023. The jeonse price ratio in Mapo-gu was 54.0%, the lowest since January last year (53.6%).