In Seoul apartment transactions last month, the share of ‘rising trades’ (deals concluded at prices higher than the immediately preceding transaction) fell markedly from the previous month. While the three Gangnam districts saw a sharp decline in rising trades, districts such as Seodaemun and Dongjak in Seoul showed a relatively steady trend.

On the 6th, real estate platform Zigbang analyzed Ministry of Land, Infrastructure and Transport apartment sale actual transaction data and found that last month the share of rising trades in Seoul apartments was 51.4%, 7.6 percentage points lower than the previous month (59%). This was the lowest level since August last year (48.1%).

In particular, in the three Gangnam districts (Seocho, Gangnam, Songpa), the share of rising trades decreased from 61.2% in February to 50% in March, a drop of 11.2 percentage points. By contrast, the share of ‘falling trades’ (deals concluded at prices lower than the immediately preceding transaction) was 35.5%, up 10.3 percentage points from the previous month (25.2%).

Zigbang said, “This is the result of multiple-home owners listing many properties to avoid the heavier capital gains tax to be applied from May, combined with homeowners who, due to higher officially assessed prices ahead of the June 1 property tax date, felt a greater tax burden and put their homes on the market.”

Excluding the three Gangnam districts, the share of rising trades across the other 22 districts was also 51.5% in March, 7.3 percentage points lower than the previous month (58.8%). The share of falling trades also rose to 31.5%, up 4.3 percentage points from the previous month (27.3%), a relatively smaller change compared with the Gangnam area.

There were also districts where the share of rising trades was similar to, or even higher than, the previous month. In Seodaemun District, the share of rising trades was 59%, 0.1 percentage point higher than the previous month, and Dongjak and Gangdong Districts also recorded relatively high shares at 61% (down 2.4 percentage points from the previous month) and 56.8% (-1 percentage point), respectively.

In Gyeonggi Province, regional disparities were even clearer. In Gwacheon, a regulated area adjacent to the Gangnam area of Seoul, the share of rising trades was 40%, narrowing by as much as 29.2 percentage points from the previous month, while in non-regulated areas such as Sosa-gu in Bucheon (50%) and Manse-gu in Hwaseong (45.5%), the share of rising trades increased by 8.1 and 6.1 percentage points, respectively, from the previous month.

Nam Hyuk-woo, a real estate researcher at Woori Bank, analyzed, “Looking comprehensively at the market in February-March, first-time homebuyers eligible for benefits were the main buying force driving the market,” and added, “There is also a possibility that a ‘leveling’ phenomenon will spread, from the outskirts of Seoul to non-regulated areas across the greater metropolitan area.”