Seoul Property Values Surge Due to Prime Real Estate Demand and Redevelopment Hopes

Seoul Apartment Prices Surge 0.13%, Gangnam and Major Districts Lead Gains Decline in Regional Markets, Nationwide Rent Prices Remain Stable SEOUL—Seoul apartment prices continue their upward trajectory, marking an increase compared to the previous week. The recent introduction of land transaction permit zones initially caused market hesitation, but investment options such as "smart one-unit investments" and high expectations for the redevelopment of luxury apartments are rejuvenating buyer interest. According to the Korea Real Estate Board's data released on May 22, covering the third week of May (up to May 19), Seoul's weekly apartment price growth reached 0.13%, up from 0.10% the preceding week, marking 16 consecutive weeks of price increases. Conversely, regional markets faced sharper declines, with a price drop of 0.04%, doubling the previous week's decline of 0.02%. Though Seoul and regional market trends sharply diverge, nationwide apartment prices remained steady at 0.00% for the second week. Among major local markets, Sejong City surged by 0.30%, driven by speculative activity around the potential relocation of the presidential office and National Assembly. Gangnam Districts Dominate Growth in Seoul's Market Analyzing district-wise performance, Seoul's wealthy Gangnam area showcased significant gains. Gangnam (0.26%), Seocho (0.32%), and Songpa (0.30%) all experienced heightened price growth, reflecting investors' sustained preference for premium assets and luxury apartments. Other districts also saw gains: Yangcheon (0.22%), Yeongdeungpo (0.16%), Gangdong (0.19%), Dongjak (0.13%), Seongdong (0.21%), Gwangjin (0.11%), and Yongsan (0.16%) posted higher growth rates compared to the previous week. Redevelopment activities in areas like Mok-dong (Yangcheon) and Yeouido (Yeongdeungpo) supported these increases. The Korean Real Estate Board remarked, “Prices in preferred redevelopment areas and prime properties continue to rise, boosted by higher seller expectations and finalized transactions at increased levels.” Even districts that previously struggled, such as Gangbuk, Dobong, and Nowon, saw price stabilization after weeks of declines. Elsewhere, Incheon recorded no changes at 0.00%, while Gyeonggi Province slid into negative territory, dropping 0.01%. However, areas within Gyeonggi, such as Gwacheon (+0.23%) bolstered by redevelopment momentum, and Seongnam Bundang (+0.21%) driven by redevelopment and reconstruction activities, defied broader trends. Contrarily, Pyeongtaek and Anseong saw declines of 0.13% and 0.11%, respectively. Rent Prices Nationwide Stable, Seoul and Regional Disparities Persist Nationwide weekly apartment rental prices mirrored the slow sales market, staying steady at 0.00% for the second week. Seoul experienced a slight increase, from 0.03% to 0.04%. In contrast, regional rental markets saw intensified declines (-0.02%), impacting both major metropolitan areas (-0.01%) and smaller provinces (-0.04%). In Sejong City, lease values climbed by another 0.04%, although at a slower pace compared to the previous week. Within Seoul, older developments and outer locations faced rental pricing pressure, whereas demand for well-situated complexes, including those near subway stations, newly constructed units, and large-scale developments, drove higher leasing activity and rent contracts. Meanwhile, Seocho (-0.06%) continued its eight-week decline in rental prices, partly due to increased supply, exemplified by the over 3,000-unit "Maple Xi" complex, cited by the Korea Real Estate Board as a factor in Seocho's rental market performance. As market dynamics continue to diverge between Seoul and other regions, selective redevelopment activities and strong demand for premium properties are shaping localized price trends in South Korea's real estate market.