Effect of Loan Regulations on June 27 Starts to Show
Price Increase Slows in 22 Districts
“Watch-and-Wait Trend Expected to Continue in Second Half”
The rise in Seoul apartment prices has slowed once again. In most areas, including the three Gangnam districts and the ‘Mayongseong’ area (Mapo, Yongsan, Seongdong districts), the rate of increase has declined for five consecutive weeks, indicating a clear trend of market observation.
According to the Korea Real Estate Board on the 31st, the price of Seoul apartments in the fourth week of July (as of the 28th) rose by 0.12%, down 0.04 percentage points from the previous week. Except for Dobong-gu (which increased from 0.02% to 0.04%), the rate of increase decreased in 22 districts.
In Songpa-gu, the increase slowed from 0.43% to 0.41%, in Seocho-gu from 0.28% to 0.21%, and in Gangnam-gu from 0.14% to 0.11%. Seongdong-gu’s increase slowed from 0.37% to 0.22%, and Yongsan-gu from 0.24% to 0.17%. Mapo-gu (0.11%) and Gangbuk-gu (0.03%) maintained the previous week’s rate of increase.
In the northern regions of Seoul, the rate decreased in Gwangjin-gu from 0.20% to 0.17%, in Dongdaemun-gu from 0.10% to 0.07%, and in Nowon-gu from 0.09% to 0.05%.
In terms of the rate of increase, Songpa (0.41%), Seongdong (0.22%), Seocho (0.21%), Yongsan (0.17%), Yangcheon (0.17%), Yeongdeungpo (0.13%), and Gangseo (0.11%) were among the highest.
Choi Won-cheol, a special professor at Hanyang University’s Graduate School of Real Estate Convergence, stated, “The buying phenomenon, which was centered around mid- to low-priced complexes, quickly fell off due to the June 27 loan regulations,” adding that while actual buyers are reviewing their additional loan capacities, only those with financial capability are engaging in transactions.
The overall apartment price in the capital region rose by 0.04%, indicating a slower rise compared to the previous week (0.06%). Gyeonggi Province rose by 0.01%, with a reduced rate from the previous week (0.02%), and Incheon saw an expanded decline (-0.02% to -0.03%). In Gyeonggi, areas like Gwacheon (0.29%), Seongnam Bundang (0.25%), and Anyang Dongan (0.19%) saw increases, while Pyeongtaek (-0.17%), Siheung (-0.10%), Goyang (-0.06%), and Gimpo (-0.03%) experienced declines.
Experts believe that the recent loan regulations have partly subdued the expectations of price increases. However, due to ongoing preference for ‘smart investments’ in high-end areas, the market is expected to continue in an observational trend rather than experience a substantial price drop for now. Professor Choi noted, “With the loan regulations compounded by redevelopment charges and interest burdens, apartment transactions are likely to remain constrained in the latter half of the year.”
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