“Small apartments in Gangnam are also trading in decline… pressure to adjust prices.”
Ham Young-jin, head of Woori Bank's real estate research lab, diagnoses price adjustment pressure in the housing market in the Gangnam area
Quick Look
- From the 29th of last month to the 4th of this month, 16 transactions occurred in apartments in the 3rd district of Gangnam, Seoul, down more than 5% from the previous transaction.
- With 8 cases in Songpa, 6 cases in Gangnam, and 2 cases in Seocho, downward transactions continued regardless of whether small or medium-sized vehicles were traded, and in the Korea Real Estate Board's weekly trend, all three Gangnam districts continued to decline.
AI-generated summary
Why It Matters
As the price of apartments in the Gangnam area of Seoul continues to decline, not only mid- to large-sized apartments, but also small-sized apartments are trading at a lower price. According to the Korea Real Estate Board's weekly apartment price trend, prices in all three districts of Gangnam continued to decline compared to the previous week, and the increase in apartment sales prices across Seoul also decreased for three consecutive weeks.
As apartment prices in the Gangnam area of Seoul continue to decline, it has been found that not only mid- to large-sized apartments, but also small-sized apartments continue to trade downward.
On the 6th, Ham Young-jin, head of Woori Bank's Real Estate Research Lab, analyzed the prices of apartments in the 3 districts of Gangnam (Seocho, Gangnam, and Songpa) registered in the Ministry of Land, Infrastructure and Transport's actual transaction price system. As a result, from the 29th of last month to the 4th of this month, there were 16 cases in which prices fell by more than 5% in the same complex and same area compared to the previous transaction.
By region, the most common cases were Songpa (8 cases), Gangnam (6 cases), and Seocho (2 cases).
Dogok Rexle (60.0㎡) fell 3.0% from 2.71 billion won to 2.63 billion won.
Songpa Wirye Complex 24 (51.77㎡) fell by 7.7% (KRW 1.62 billion → KRW 1.495 billion), and Jamsil Jugong Complex 5 fell by 8.1% (KRW 4.057 billion → KRW 3.727 billion).
There was also a case where Gangnam Seongwon Daechi Complex 2 (49.86㎡, exclusive area below), which was traded for 2.055 billion won in July this year, was priced at 1.4 billion won last month, falling 31.9%.
There are also frequent cases of declines in ultra-high-priced and mid-to-large apartments.
Seocho Raemian One Bailey (84.98㎡) was traded at 5.7 billion won, 1.45 billion won lower than the previous transaction price of 7.15 billion won, showing a 20.3% decline.
Gangnam Hyundai Green 1 (84.93㎡) fell 10.2% from 2.45 billion won to 2.2 billion won.
Lab Manager Ham diagnosed, “As downward transactions have been confirmed not only in high-priced apartments and reconstruction complexes, but also in large complexes and small and medium-sized apartments, there is pressure to adjust prices in the housing market in the Gangnam area, which has maintained a solid trend so far.”
He added, "However, the price and volume of subsequent transactions are expected to determine whether the price adjustment in the Gangnam area is a temporary process of extinguishing quick sales or will lead to a downward adjustment of the market as a whole."
According to the weekly apartment price trend (as of November 2) announced by the Korea Real Estate Board the previous day, prices in Gangnam (-0.39%), Seocho (-0.37%), and Songpa-gu (-0.17%) all fell compared to the previous week and continued to decline.
The sale price of all apartments in Seoul, including this one, rose by an average of 0.07% compared to the previous week, but the increase has decreased for three consecutive weeks.
What to Watch
AI outlook — possibilities, not facts
The decline in apartment prices in the Gangnam area is likely to continue for a short period of time.
Likely · Within weeks
The price and volume of subsequent transactions are expected to determine whether the price adjustment in the Gangnam area is temporary.
Likely · Within weeks
Open Questions
- Will the price adjustment in the Gangnam area be a temporary process of extinguishing quick sales, or will it lead to a downward adjustment of the overall market?
- How price and volume will move in subsequent transactions
