Prices at South Korea's priciest large apartment complexes in Seoul fell for the first time in four months, as the high-end market including the Gangnam area cooled following the government's tax overhaul plan.
Seoul apartment sale prices rose 1.13% in September from a month earlier, with the pace of gains slowing by 0.01 percentage point, according to KB Real Estate's nationwide housing price survey released on the 28th.
The KB Leading Apartment 50 Index fell 0.22% from August to 99.2, its first decline since May, when it dropped 0.55%. The index tracks monthly changes in the combined market value of the 50 most valuable apartment complexes, including Raemian One Bailey in Banpo-dong, Seocho-gu.
The high-end complexes had declined for three straight months ahead of the expiry of a grace period on heavier capital gains taxes for multiple-home owners, falling 0.73% in March, 0.48% in April and 0.55% in May. They then rose 0.14% in June, 0.38% in July and 0.20% in August before turning lower this month, after the tax overhaul plan was announced early last month.
Outer districts of Seoul continued to advance. Nowon-gu led with a 2.32% gain, followed by Jungnang-gu at 2.20%, Dobong-gu at 1.95%, Seongbuk-gu at 1.93%, Gangbuk-gu at 1.90%, Gangseo-gu at 1.75% and Guro-gu at 1.63%. The largest increases were concentrated in outlying areas where prices are relatively low.
Gangnam-gu, by contrast, fell 0.30% from the previous month, reversing course. The divergence set the Gangnam area, home to a cluster of high-priced large complexes, against the cheaper outer districts.
Gyeonggi Province saw its gains widen. Apartment sale prices there rose 1.06% in September, accelerating by 0.23 percentage point from August. The strength was most pronounced in southern Gyeonggi, seen as a residential hub serving the semiconductor industry. Yeongtong-gu in Suwon rose 4.30%, the biggest gain in the province, followed by Dongan-gu in Anyang at 2.75%, Gwangmyeong at 2.73%, Byeongjeom-gu in Hwaseong at 2.71% and Paldal-gu in Suwon at 2.51%. All five posted their strongest monthly gains of the year.
Jeonse prices for Seoul apartments rose 1.00%, with the pace easing by 0.10 percentage point from the previous month. Jeonse is a Korean lease system requiring a large lump-sum deposit instead of monthly rent. The biggest increases came in Nowon-gu at 2.04%, Seongbuk-gu at 1.93%, Gangbuk-gu at 1.84%, Gangdong-gu at 1.83%, Jungnang-gu at 1.47%, Songpa-gu at 1.40% and Yeongdeungpo-gu at 1.24%, while Gangnam-gu fell 0.19%.
Gyeonggi rose 0.80%, with gains widening by 0.10 percentage point from August. Jeonse prices climbed in Gwangmyeong at 1.88%, Hanam at 1.75%, Dongtan-gu in Hwaseong at 1.73%, Byeongjeom-gu in Hwaseong at 1.67%, Jangan-gu in Suwon at 1.43%, Guri at 1.41% and Yeongtong-gu in Suwon at 1.39%.
