Apartment listings priced between 2 billion won and 3 billion won ($1.5 million to $2.2 million) are piling up fastest in Seoul's housing market following the government's tax overhaul. Within less than a month of the announcement, such listings surged 15%, a sharper increase than for ultra-high-end homes priced above 4 billion won, where heavier tax burdens had been expected to drive stronger selling pressure. More owners are putting homes on the market to trade up to pricier neighborhoods, but buyers are staying on the sidelines, deepening a backlog concentrated in what the market calls "less-than-prime single homes." Adding to the uncertainty, the ruling party is pressing for revisions to the tax plan, suggesting both sellers and buyers will keep waiting to see which way policy turns.
Seoul had 11,245 listings priced between 2 billion won and 3 billion won as of the 26th, excluding duplicates, up 15% from 9,775 on the 1st, just before the tax plan was announced, according to data compiled by real estate data platform Kokjib at the request of The Seoul Economic Daily on the 27th. That outpaced the 9.7% increase for homes priced above 4 billion won, where selling pressure had been expected to be strongest because of higher taxes. Listings across Seoul rose 7.7% over the same period.
Brokers say listings have climbed quickly but buyers have vanished, leaving inventory unsold. An agent at a brokerage near the Raemian complex in Dangsan-dong, Yeongdeungpo District, said sellers keep calling to ask for quick sales while inquiries from buyers are almost nonexistent. The agent said nearby apartments in the 2 billion won range face the same situation.
At the Hangaram apartment complex in Ichon-dong, Yongsan District, which is pursuing a remodeling project, listings for 84-square-meter units, including duplicates, rose 113% to 100 from 47 over the same period. As listings more than doubled, the median asking price fell 100 million won to 2.85 billion won from 2.95 billion won. Listings for 59-square-meter units also rose 91% to 42 from 22. An agent at a brokerage in Ichon-dong said some owners are clearing homes they do not live in, while many others are trying to trade up to more expensive areas. Because buyers are not biting, the agent said, many sellers keep asking about nearby asking prices and list their homes with several brokerages at once.
At Olympic Park Foreon in Gangdong District, listings for 59-square-meter units rose 79% to 175 from 98. The median asking price fell 140 million won to 2.65 billion won from 2.79 billion won over that period. Of 816 listings in the 2 billion won range that changed asking prices over the past week, 71%, or 578, cut them, according to Kokjib. Cho Yong-ho, co-founder of Kokjib, who conducted the analysis, said a wait-and-see stance prevails on both the buying and selling sides and that listings have been accumulating rapidly even over the past few days. Cho described the market as a mix of demand to trade up to pricier neighborhoods and expectations of falling prices.
Buyers are hesitating even on discounted listings because of policy uncertainty and lending curbs. The ruling party is asking the government to ease a planned reduction in the basic comprehensive real estate tax deduction for owners of a single home they do not live in, and to slow a shift toward residency-based criteria in the long-term holding deduction for capital gains tax. That raises the likelihood that owners who have listed homes will wait for the outcome rather than cut prices further right away. Nam Hyuk-woo, a researcher at Woori Bank's real estate research institute, said those who listed homes out of concern over tax burdens may hold off on selling while they watch how the situation develops. Still, Nam said, unless the core elements of the comprehensive real estate tax and the capital gains tax change, some owners will continue to weigh selling.
