Seoul's apartment jeonse supply-demand index hit the highest level in five years. The wolse supply-demand index is also rising quickly.
According to the Korea Real Estate Board (REB) on the 21st, Seoul's apartment jeonse supply-demand index for the second week of June (on the 15th) was 122.5, the highest in about five and a half years since the third week of February 2021 (122.8).
The supply-demand index is an indicator that shows the balance between jeonse demand and supply. Above 100 means demand exceeds supply, and the higher the figure, the more severe the shortage of jeonse listings. As the jeonse shortage worsens, upward pressure on jeonse prices also grows.
Along with jeonse, wolse supply-demand is also deteriorating in tandem. The wolse supply-demand index, published on a monthly basis, rose 5.1 points month over month to 114.8 in Seoul last month. The monthly increase, which had been around 1 point this year, jumped sharply last month.
The biggest cause of the jeonse and wolse crunch is cited as a decline in dwellings supply. According to announcements in Feb. by the Korea Real Estate Board (REB) and Real Estate R114, the number of multiunit dwellings move-ins in Seoul this year is 27,058 households, and it is expected to plunge to 17,197 households next year.
As it has become harder to find rental listings, the share of renewals of dwellings lease contracts has also risen sharply. According to the Ministry of Land, Infrastructure and Transport's actual transaction disclosure system, from the 1st of last month to the 19th of this month, among Seoul apartment jeonse and wolse transaction (23,180 cases), renewals totaled 11,366 (49.0%). In the same period last year, about 37% (13,594) of a total 36,753 cases were renewals.
On a cumulative basis from January this year, renewals accounted for 45.4% (47,792 cases) of Seoul jeonse and wolse transaction (105,302 cases), up 9.2 percentage points from the same period last year (36.2%).