Apartment prices in Seoul's Yongsan District have turned downward again ahead of the capital gains tax surcharge on multi-home owners set to take effect on May 9. The decline appears driven by distressed sales from multi-home owners, which have pushed prices lower. Meanwhile, Seoul's jeonse (lump-sum deposit lease) prices continue their 60-week surge, deepening instability in the rental market.
According to the Korea Real Estate Board's weekly apartment price trends released on the 16th, Seoul apartment sales prices rose 0.10% in the second week of April (as of the 13th), unchanged from the previous week. Seoul apartment prices have shown mixed signals this year, declining for seven consecutive weeks before rebounding and then falling again.
Yongsan District (-0.04%) apartment prices, which had appeared to briefly rebound, turned negative again after three weeks. Prices in the Gangnam Three Districts have been declining for seven weeks since the fourth week of February. Gangnam District (-0.10%) saw a smaller decline than the previous week, while Seocho District (-0.06%) and Songpa District (-0.02%) remained at similar levels.
Other districts showed divergent trends. Gangbuk, Mapo, Dobong, Gwangjin, and Dongjak districts saw larger gains. However, Jung, Guro, Gwanak, Nowon, and Yeongdeungpo districts saw weakening growth. A Korea Real Estate Board official explained, "While some areas saw declining transactions due to price-adjusted properties coming to market, contracts with rising prices are being signed for highly sought-after complexes."
Experts expect the standoff between buyers and sellers to continue for the time being. Nam Hyuk-woo, a real estate researcher at Woori Bank, said, "Although buyer sentiment has improved slightly, the possibility of distressed sales remains due to concerns over prolonged Middle East conflicts and changes to the capital gains tax surcharge deferment criteria. Prices are likely to remain range-bound, with stop-and-go movements for the time being."
Seoul jeonse prices rose 0.17% over the week. The jeonse price index has been climbing for 60 consecutive weeks since turning upward in the first week of February last year. The cumulative jeonse increase during this period has reached 5.56%. A Korea Real Estate Board official said, "The shortage of available properties continues throughout Seoul, with rental demand particularly concentrated in complexes with favorable living conditions such as those near subway stations."
