An upward trend for apartment prices in Seoul has continued for 40 weeks in a row, since last June, according to the state-run Korean Real Estate Board on Thursday. Market experts say unstoppable apartment price increases in Gangnam have driven the growth, inflating home prices in other regions in and around Seoul.
The rate of increase stayed between 0.1 percent and 0.2 percent during most of the second half last year, and this year it increased from 0.06 percent in the first week of January to 0.1 percent in the first week of February.
The growth rate dipped to a low of 0.05 percent in the first week of April after the government announced measures to cool down the heated real estate market, including plans for new apartment buildings, Feb. 4. But prices gained momentum on expectations for looser redevelopment regulations with the election of Seoul Mayor Oh Se-hoon, who had vowed to deregulate the property market.
“A recent listing of an apartment unit in Gangnam, priced at 100 million won ($89,520) per square meter, seems to have made apartments in non-Gangnam regions relatively cheaper, and soaring prices in Incheon and Gyeonggi Province raised expectations that apartment prices in Seoul will continue to be on the rise,” said Park Won-gab, a senior real estate researcher at commercial bank KB Kookmin Bank.
“It is unlikely that home prices will take a downward turn anytime soon due mainly to a supply shortage and expectations for eased mortgage regulations,” he added.
It is expected that the upward trend could continue in 2022 as candidates for the South Korean presidential election, set for March next year, will likely roll out deregulation pledges and redevelopment plans.
According to data compiled by KB, the average sales price for an apartment in Gangnam-gu came in at 23 million won per square meter last month -- the highest among the city’s 25 districts.
Seocho-gu came second at 19.95 million won per square meter, while Songpa-gu took the third spot at 16.55 million won per square meter.
By Kim Young-won (email@example.com