The pace of gains in Seoul apartment prices is slowing, centering on the three Gangnam districts (Seocho, Gangnam, and Songpa) and Yongsan, where many high-priced apartments are concentrated.
According to a KB Real Estate survey on the 8th, the average sales price for the fifth quintile of Seoul apartments in February was 3.4712 billion won, up 5.27 million won from January. The quintile is a statistic that divides dwellings into five groups by price and calculates the average for each group; the first quintile is the bottom 20% low-priced dwellings, and the fifth quintile is the top 20% high-priced dwellings. Most fifth-quintile apartments in Seoul are clustered in the three Gangnam districts and Yongsan.
On KB's statistics, the average price of Seoul's fifth quintile has been rising continuously since March 2024. In most months it rose by tens of millions of won from the previous month, and in June last year, when the market overheated around the launch of the current administration, it climbed 134.77 million won from the previous month, marking a gain in the hundreds of millions within a single month.
Compared with that, February's figure this year, with the month-over-month increase below 10 million won, shows a clear drop in the rate of increase.
It is markedly lower than the month-over-month increase in January, the immediately preceding month (27.44 million won), and it falls short of even one-tenth of the average monthly increase for the fifth-quintile price from February last year to this February (59.96 million won).
The survey reference date for this statistic is Feb. 9, so it did not fully reflect the slowdown in Seoul apartment prices in February, but it did partly capture conditions after Jan. 23, when President Lee Jae-myung confirmed there would be no extension of the capital gains tax relief for multiple-home owners.
Earlier, the government said it would end the capital gains tax relief for multiple-home owners on May 9 and announced supplementary measures that take into account situations such as the presence of tenants, and it is also reviewing regulations on nonresidential single-home holdings suspected of being used for speculation or investment.
Meanwhile, based on the weekly apartment price trend from the government-certified statistics by the Korea Real Estate Board (REB), sales prices of apartments in Seoul's three Gangnam districts and Yongsan fell for two consecutive weeks recently, and KB's statistics also showed Gangnam District turning to a decline last week.
It is interpreted that sharply discounted listings, put on the market by multiple-home owners seeking to dispose of dwellings before the end of the capital gains tax relief, combined with profit-taking sales by high-end homeowners concerned that tax burdens could grow due to future property tax revisions, have pulled down prices in these areas.
Elderly single-home owners in prime areas who hold high-priced dwellings but have no significant source of income after retirement—and thus would face heavier tax burdens if the property tax rises—and nonresidential single-home owners, who have been repeatedly mentioned as targets of additional government regulation, are also expected to influence this trend as they move to sell their homes.