Apartment prices hit new high in and around Seoul

Apartment prices in Korea hit an all-time high in February by recording 10.47 million won ($9,258) per 3.3 square meters (35.5 square feet) on the back of high demands for new premium apartments and a rise in the price of apartments on the outskirts of Seoul, according to a market report Sunday.

According to Budongsan 114, a real estate information provider, the apartment price for February was 10.47 million won per 3.3 square meter, a 4.8 percent year-on-year increase. The price has been on an upward trend nationwide since last April, when it first broke the 10 million won mark by recording 10.01 million won per 3.3 square meters. Seoul’s apartment prices also hit its all-time high by recording 19.13 million won for the same size lot.

Real estate prices for Gangnam District, southern Seoul, one of the most expensive neighborhoods in Korea, went down due to a policy launched by the government last year to prevent speculative real estate investment in the extremely overheated market.

But except for Gangnam and seven other districts, including Yangcheon, which already experienced an increase in housing prices last year due to expectation of redevelopment, 18 districts in Seoul recorded all-time highs.

“There were constant demands for new, premium apartments in reconstructed areas,” said Kim Eun-jin, a head of research team at Budongsan 114, “and even after the new real estate policy took effect, actual demand for houses kept rising which acted as vital factors behind the continuous rise in house price in Korea.”

House prices for Gangnam recorded 35.7 million won per 3.3 square meter in February, down from its all-time high of 35.76 million won last October.

Mapo, Gwangjin and Jongno districts’ housing prices neared 20 million won this month, recording 19.1 million, 18.67 million and 18.61 million won respectively per 3.3 square meter.

Outside Seoul, Busan showed the highest price increase rate of 10.6 percent in February compared to the same month last year. It now costs 9.46 million won per 3.3 square meter.

Gangwon Province continued to record an all-time high on the back of rising expectations for the upcoming PyeongChang Winter Olympics, which is less than one year away.

Enhanced accessibility to Pyeongchang with a soon-to-be-completed highway connecting east Hongcheon and Yangyang in Gangwon, and a new railroad connecting west Wonju and Gangneung, has also contributed in its real estate boom.

BY JIN EUN-SOO [jin.eunsoo@joongang.co.kr]