"No More Following the Leader?" The Game Begins as Seoul's Real Estate Market Faces a Three-Way Split

00:00 Apgujeong apartments drop by 3.5 billion won, why?
01:12 Tax revision bill, how much impact on home prices?
02:23 "Shuttle-accessible" areas near Samsung and SK Hynix, rising outer districts
03:05 A three-way split in Seoul's real estate

1. Apgujeong Apartments Drop by 3.5 Billion Won, Why?
High-end apartments in Apgujeong-dong, Gangnam-gu, Seoul, have recently been selling for billions of won lower than their previous peaks. For one complex in Apgujeong District 2, the largest 183-square-meter unit hit a record high when it sold for 12.8 billion won in December of last year. However, entering this year, it traded for 10 billion won in July, and this month it sold for 9.3 billion won. That is a drop of 3.5 billion won from its peak. An adjacent complex also sold for 11.25 billion won last July, but dropped to 10 billion won in September and 8.8 billion won this month. These consecutive transactions at prices lowered by billions of won are analyzed to be due to regulations prohibiting the sale of homes once reconstruction gets underway. For District 2, which has the fastest reconstruction speed in Apgujeong, the district plans to apply for project implementation authorization around the beginning of next month. Under the law, reconstruction complexes in overheated speculation zones are virtually barred from selling homes after applying for project implementation authorization, with only very few exceptions.

[Park In-gu / Apgujeong Real Estate Agent: Once you apply for project implementation authorization, the transfer of union membership status is restricted in principle. So it seems some properties were put on the market as quick sales to sell ahead of that.]

2. Tax Revision Bill, How Much Impact on Home Prices?
This has been compounded by the impact of the government's tax revision bill announced on August 3. The government is pushing to significantly increase the comprehensive real estate holding tax burden on ultra-high-value homes, while limiting the maximum long-term holding special deduction to 1 billion won regarding capital gains tax incurred when selling a home.

[Apgujeong Apartment Union Member: Since the average age is over 60, cash flow is low, and the comprehensive real estate tax is expected to go up about three to four times. (Older residents who have lived here for a long time either have to leave or cannot withstand the burden...)]

Following the announcement of the August 3 tax revision, the downward trend in the Gangnam area is pronounced. Because taxes are expected to rise significantly, quite a few people are trying to sell, but buyers are blocked by loan restrictions, meaning only some cash-rich buyers can absorb high-end apartment properties in Gangnam. The three Gangnam districts have been falling for nine consecutive weeks. As of October 26, weekly apartment sales prices fell by the 0.3% range in Gangnam and Seocho, and by the 0.2% range in Songpa. However, all other areas in Seoul excluding the three Gangnam districts continue to rise. Across Seoul as a whole, prices rose 0.09% over the week.

3. "Shuttle-Accessible" Areas Near Samsung and SK Hynix, Rising Outer Districts
Recently, outer districts of Seoul have been rising, with Seongbuk-gu up 0.39%, Seodaemun-gu up 0.36%, and Gangbuk-gu and Dobong-gu rising 0.32% each. In addition, the semiconductor belt near Samsung Electronics and SK Hynix—specifically southern Gyeonggi areas serviced by company shuttle buses, so-called shuttle-accessible locations—are showing formidable upward momentum in the second half of this year. Sales prices in Dongtan, Hwaseong surged by a whopping 21% this year, while Gwangmyeong rose 17%, Yeongtong District in Suwon rose 17%, and Guri and Hanam rose in the 13% range. This is much higher compared to Seoul's overall home price increase of 8.7% this year.

4. A Three-Way Split in Seoul's Real Estate
To sum up, Seoul is largely divided into three directions in the second half of this year. First, the three Gangnam districts continue their downward trend. The Han River belt areas excluding the Gangnam region—such as Dongjak, Seongdong, and Yeongdeungpo—saw their upward momentum narrow slightly. Outer districts referred to as "Nodo-gang" (Nowon, Dobong, Gangbuk) and "Geum-gwan-gu" (Geumcheon, Gwanak, Guro) still show high growth rates. This is because government policies tend to divide market directions based on sale prices of 15 billion won and 30 billion won. Gangnam is declining, the rest of the Han River belt is pausing to catch its breath, and outer districts are catching up in price—much like the Three Kingdoms, it can be compared to a "three-way division of Seoul." How long these directions will last depends on changes in government policy or the impact of high interest rates, so we will need to keep an eye on developments.

Reported by Jeon Hyeong-u | Produced by Shin Hee-suk | Video by Park Hyun-cheol | Video Editing by Seo Byung-wook | Graphics by Lee Jung-joo | Produced by SBS Digital News
※ Please note: This article was translated by AI and may contain errors.