Apartment prices across Seoul have risen for 78 consecutive weeks, though the rate of increase in the high-end Gangnam area has slowed [1].
This shift indicates a growing divide in the Seoul real estate market. While luxury properties face uncertainty due to impending policy changes, mid-to-low priced housing remains attractive to buyers seeking lower tax burdens.
The slowdown in the Gangnam district, particularly in areas like Seocho-gu, is linked to an upcoming announcement regarding tax reforms targeting high-value homes [1]. Potential buyers are adopting a wait-and-see approach to determine how these changes will affect their financial obligations.
"Due to the influence of buyers' wait-and-see attitude ahead of the announcement of the tax reform plan targeting high-priced houses, the rate of increase in house prices in the Gangnam area of Seoul slowed this week," a YTN News anchor said [1].
Real estate agents said the trend is exacerbated by strict loan regulations. Many buyers lacking sufficient cash are waiting for prices to drop further before entering the market [1].
Conversely, the demand for mid-priced apartments has strengthened. These properties are viewed as safer investments because they carry a lower tax burden compared to the ultra-luxury units found in the city's most expensive districts [1].
Reporter Jung Hyun-woo said the impact is most visible in the Seocho-gu area, where many ultra-high-priced apartments are located and where tax burdens are expected to increase under the new plan [1].
“Seoul apartment prices have risen for 78 consecutive weeks.”
The divergence in Seoul's property market suggests that government fiscal policy is successfully cooling the luxury segment, but may be inadvertently pushing demand toward mid-tier housing. This creates a 'balloon effect' where price stability in one sector leads to inflation in another, potentially making entry-level homeownership more difficult for the general public.
