The share of out-of-town buyers, including those living in the provinces, purchasing Seoul apartments on "expeditions" fell to the lowest level in about nine years. In contrast, the share of Seoul residents buying apartments in other regions increased.
An analysis of apartment sale transactions by buyers' residence released by the Korea Real Estate Board (REB) on the 5th showed that the number of reported Seoul apartment sale transactions over the four months from November last year to February this year (by report date) totaled 20,810. Of these, purchases by out-of-town residents numbered 3,914, accounting for 18.81% of the total.
This is a drop of about 5 percentage points compared with 23.06% in the previous four months (July–October). It is the lowest level in about nine years since 18.45% in February–June 2017.
The decline in the share of Seoul apartment purchases by out-of-town residents, including those in the provinces, is attributed to the fact that, after the Oct. 15 measures last year, all of Seoul was designated a land transaction permit zone, and the end-user occupancy requirement restricted "gap investment" purchases with tenants in place.
The reduction of the allowable loan amount to 200 million–600 million won is also seen as having raised the barrier for out-of-town residents to buy Seoul apartments.
In particular, the drop was steep in the Han River belt areas that drove last year's rise in Seoul apartment prices. In Seongdong District, the share of Seoul apartment purchases by out-of-town residents expanded to 26.07% just before the Oct. 15 measures, then fell to 6.8% after the Oct. 15 measures.
In Mapo District, it fell from 26.5% just before the Oct. 15 measures to 19.5%; in Yeongdeungpo District, from 27.9% to 18.9%; in Gwangjin District, from 21% to 17.3%; in Dongjak District, from 26.5% to 20.09%; and in Yangcheon District, from 18.9% to 14.2%.
On a monthly basis, the share of out-of-town residents buying Seoul apartments increased from 16.15% in January this year to 18.39% in February.
This is interpreted as being influenced by the government's temporary allowance of deferred owner-occupancy for listings by multiple-home owners during the existing tenants' lease terms, ahead of the end of the capital gains tax surcharge deferral for multiple-home owners on May 9 this year, which made short-term gap investments possible.