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Seoul apartment prices in non-Gangnam areas rise upon mortgage ban

This file photo shows apartment complexes in the Gangnam area in southern Seoul. (Yonhap)
This file photo shows apartment complexes in the Gangnam area in southern Seoul. (Yonhap)

Despite the government’s tightened regulations to curb apartment prices in Seoul, the average rate has risen during the first five months this year, particularly in the middle-class districts, data showed Monday.

The average apartment price in the city stood at 10.64 million won ($8,670) per square meter as of end-May, up 4.9 percent from December, according to real estate data tracker KB Kookmin Bank Liiv On.

Areas considered less-wealthy, including Dongdaemun-gu and Seongbuk-gu, saw apartment prices rise by more than 10 percent. Apartment prices in posh districts, including Ganam-gu, Seocho-gu, and Songpa-gu, rose 2.3 percent, 2.2 percent and 1.5 percent, respectively. The figures were the lowest among the city’s entire 25 districts.

The respective average apartment price in Gangnam, Seocho and Songpa grew 7.5 percent, 8 percent, and 10.8 percent between July and December last year, right before the government introduced a series of measures.

The government’s real estate regulations announced on Dec. 16 ban mortgage loans on apartments priced 1.5 billion won or higher, which have affected homes in relatively rich districts. Those priced at 900 million or lower are under less strict regulations and consequently saw demand increase in the past months.

An 84-square meter apartment, deemed as a popular apartment size for an average household in the city, costs 895 million. The price for the same-sized apartment came in 1.67 billion won in Gangnam, 1.47 billion won in Seocho, and 1.14 billion won in Songpa. Except for the three districts, Yongsan-gu in central Seoul was the only area that exceeded the 1-billion won mark.

By Kim Young-won (wone0102@heraldcorp.com)
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