With the Oct. 15 real estate measures placing all of Seoul under a land transaction permission zone, the number of land transaction permits has recently increased. In particular, permits in Nowon, Seongbuk, and Eunpyeong have risen sharply compared with the three Gangnam districts (Gangnam, Seocho, Songpa).
According to an analysis by ZIGBANG CO. on the 12th of Seoul City's land transaction permission records, 5,252 permits were recorded over the 40 days from Oct. 20 to Nov. 28 last year. In the following 40 days, from Nov. 29 to the 7th of this month, the number of permission transactions was 5,937, up 13% from the previous 40-day period.
By district, contrasting trends appeared between areas where the existing land transaction permission zones were maintained and areas newly designated. ▲Songpa 827→439 ▲Gangnam 484→233 ▲Seocho 362→164 ▲Yongsan 199→90 saw fewer permits. In contrast, newly regulated areas showed marked increases in permits, including ▲Nowon 284→615 ▲Seongbuk 259→392 ▲Eunpyeong 203→313 ▲Guro 176→312 ▲Yeongdeungpo 131→311.
Among Seoul's 25 districts, Nowon saw the largest increase in permits. Nowon recorded 615 permits in the 40 days after the land transaction permission zone designation, up about 117% from 284 immediately after designation. Ministry of Land, Infrastructure and Transport actual sales transaction data also show transactions rose from 210 to 401 during the same period, the most among the 25 districts. In addition to the relatively lower transaction price range of 500 million to 600 million won compared with other areas, the posting of district unit plans around Sanggye and Junggye and some complexes being mentioned as candidates for complex redevelopment zones appear to have bolstered buying interest in the Nowon area.
The increase in land transaction permits is interpreted as a sign that transaction sentiment, which had cooled immediately after the regulations took effect, is recovering to some extent. In particular, because the rules require actual residency, the flow of transactions based on real demand rather than short-term expected revenue appears to be holding at a certain level.
The decline in permits in Gangnam, Seocho, Songpa, and Yongsan, which were already land transaction permission zones, appears to reflect accumulated market fatigue amid a prolonged regulatory environment.
Kim Eunseon, head of the big data lab at ZIGBANG CO., said, "Recently, as concerns over high price levels and perceptions of a peak have spread, a more cautious attitude toward transactions has emerged," adding, "With judgments factoring in potential mid- to long-term risks such as changes in tax and regulatory environments going forward, the momentum for additional demand inflows appears somewhat weaker."
In areas newly included in land transaction permission zones, after a brief wait-and-see period at the outset of regulation, transactions centered on end users are gradually recovering. As understanding of the permit procedures and system increases and adaptation progresses, demand that proceeds with transactions under the judgment that the actual residency requirement can be met is also being detected.
Kim said, "This trend is relatively more pronounced in areas with steady residential demand or where a demand base centered on actual occupancy has formed, and it can be interpreted that selective buying is moving according to changes in the policy environment."
This year's housing market faces various policy and institutional variables, including additional real estate measures, tax adjustment discussions, and local elections, requiring close observation of market trends. Kim said, "Depending on policy direction, interest rate levels, and whether regulations are eased or tightened, the market's flow and the speed of transactions may change," adding, "Going forward, the market needs to look at how immediate reactions to regulatory changes, along with shifts in perceptions of supply, are reflected in end users' mid- to long-term decision-making."