Seoul Land Transaction Permits Triple as Mid-Tier Markets Drive Recovery

Land transaction permits in Seoul have surged sharply this month, signaling a potential end to the transaction freeze that gripped the capital's property market.

According to the Seoul Metropolitan Government's Land Information System analyzed on the 9th, the number of land transaction permits from the 1st to the 9th of this month reached 2,255—more than triple the 646 permits recorded during the same period in November last year. December and January saw 1,653 and 1,520 permits respectively during the same nine-day windows.

The surge is concentrated in mid-tier districts rather than premium areas. Nowon-gu permits jumped from 119 last month to 274 this month, while Yeongdeungpo-gu doubled from 77 to 155. Meanwhile, traditionally premium districts showed flat or declining activity. Gangnam-gu fell from 72 to 65 permits, and Seongdong-gu dropped from 51 to 48.

The recovery follows a severe market contraction triggered by the October 15 measures last year, which designated all of Seoul as a land transaction permit zone and imposed strict lending regulations. Monthly transactions plummeted from 11,041 in October to 4,395 in November and further to 3,656 in December.

Analysts attribute the rebound to first-time homebuyers entering the market amid worsening jeonse conditions, gravitating toward mid- and lower-priced properties less affected by lending restrictions.

"Non-homeowners have recently begun participating as the main demand group," said Nam Hyuk-woo, a researcher at Woori Bank's Real Estate Research Institute. "The demand base itself has broadened, with various age groups entering the market."

Market participants are also adapting to the permit system after an initial learning curve of three to four months. The process requires buyers and sellers to submit documentation to local governments after agreeing on contract terms, with applications potentially rejected if requirements are not met.

"If we annualize this month's transaction volume, it reaches approximately 6,000 units, recovering to pre-permit zone annual averages," said Yoon Su-min, a real estate specialist at NH Bank. "A substantial volume is being absorbed by the market."

Transaction volumes are expected to remain elevated during the traditional spring moving season, with some rental market demand shifting to purchases amid jeonse price volatility.

However, the May 9 deadline for capital gains tax relief on multi-property owners poses uncertainty. Tax-motivated listings may dry up after that date, potentially triggering another transaction freeze.

"Transaction growth will continue for a while due to seasonal demand concentration," Nam said, "but tax issues could become a variable."