As apartment prices in Gangnam’s three districts, which led the rise in apartment prices in Seoul, have continued to decline, the analysis that apartment prices across the country, including Seoul, have entered a full-fledged ‘second decline’ is gaining ground. Experts say that this downward trend will continue for a while, but that there will not be a sharp decline like last year.
A view of an apartment in Seoul. 2023.12.21/News1 © News1 Reporter Park Jeong-ho
According to the Korea Real Estate Board’s weekly apartment price trend survey for the 3rd week of December (as of the 18th) on the 23rd, Gangnam-gu, Seoul fell 0.04% compared to the previous week, falling for 5 consecutive weeks from the 3rd week of November (November 20th). Seocho-gu fell 0.04%, falling for 4 consecutive weeks since the 4th week of November (November 27). Songpa-gu fell 0.03%, which is the second consecutive week of decline since the second week of December (as of the 11th).
Seoul recorded -0.04%, falling for 3 consecutive weeks, and the nation also recorded -0.05%, falling for 4 consecutive weeks. During the same period, the metropolitan area fell 0.06%, showing a decline for 4 weeks in a row, and provincial areas also fell 0.04%, showing a decline for 4 weeks in a row.
Seoul apartment transaction volume is decreasing and listings are piling up.
According to the Seoul Real Estate Information Plaza, as of the 21st, the number of monthly apartment sales in Seoul was △3,436 in May, △3,846 in June, △3,588 in July, △3,867 in August, △3,372 in September, △2,311 in October, and △1,767 in November. It turned out to be a case.
According to Asil, a real estate big data company, the number of apartment listings in Seoul was 76,795 as of the 19th, an increase of 49.4% compared to 51,370 in the same period last year. This is the highest level since April 2021, when Asil compiled related statistics.
Experts believe that the second decline has begun in earnest as they observe the ‘transaction cliff’ that appears simultaneously with the decline in apartment prices in major areas of Seoul.
Kim Hyo-seon, a senior member of NH Nonghyup Real Estate, said, “After Chuseok of this year, the general type of special home loan disappeared from the second half of the year and regulations were strengthened due to stress DSR (total debt service ratio) regulations, so I believe that the background to the current decline is that consumers have taken a wait-and-see approach.” He analyzed, “Unless the government comes up with special measures, I think the current situation will continue for a while.”
Seo Jin-hyeong, a professor at Kyungin Women’s University, also said, “Currently, a trading cliff phenomenon is appearing as the power struggle between selling and buying forces continues. This situation is expected to continue at least until the first half of next year.”
However, it is expected that the current second decline phase will not lead to a drastic price decline like last year.
Senior Commissioner Kim said, “During the period of rapid decline in the second half of last year, apartment prices also fell rapidly as interest rates rose quickly. However, this year, interest rates started from high and then fell, so I do not think there is a high possibility of a sharp decline.”
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Professor Seo also said, “Currently, there is a transaction cliff, so it is too early to judge that a second decline has occurred with only a few transactions.” He added, “It may show a sideways trend and then move to low interest rates, or it may move upward when the economic situation improves.”
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2023-12-22 22:24:17
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