Smaller apartments are gaining ground in Seoul's housing market, with units of 59 square meters of exclusive floor area commanding steadily higher relative prices. As rising home prices and mortgage restrictions squeeze buyers, owner-occupier demand is shifting toward smaller homes with lower entry barriers. Some buyers are also willing to accept less space to live in preferred neighborhoods. As a result, the price gap between 59-square-meter units and the 84-square-meter layout widely known as the "national standard" size is narrowing in both sales and jeonse, a lump-sum deposit lease.
An analysis of the Ministry of Land, Infrastructure and Transport's actual transaction price disclosure system on the 5th showed that the relative value of 59-square-meter units in Seoul has risen sharply from five years earlier. Across 69 identical Seoul apartment complexes where both unit types recorded sales in August 2021 and again in August this year, the average price gap between the two narrowed to 13.0% from 22.5%, a decline of 9.5 percentage points.
Individual complex transactions show the trend clearly. At Raemian Wive in Dapsimni-dong, Dongdaemun-gu, the median sale price in August 2021 was 1.23 billion won for a 59-square-meter unit and 1.515 billion won for an 84-square-meter unit, a difference of 285 million won. By August this year, the figures were 1.61 billion won and 1.67 billion won, leaving a gap of just 60 million won.
At the Ssangyong apartment complex in Imun-dong, 59-square-meter units rose to 1.0715 billion won from 805 million won over the same period, while 84-square-meter units climbed to 1.075 billion won from 932.5 million won, narrowing the gap to 3.5 million won from 127.5 million won. A broker near the complex said buyers purchasing apartments priced below 1.5 billion won often borrow up to their maximum limit, and even a small difference frequently puts an 84-square-meter unit out of reach.
Asking prices show a similar pattern. At Lotte Castle Beneluce in Godeok-dong, Gangdong-gu, a 59.9-square-meter unit is listed at 1.8 billion won and an 84.9-square-meter unit at 1.95 billion won, a difference of about 150 million won. A broker in Dongdaemun-gu said more people have clearly favored smaller layouts recently, noting that the lowest asking price for a 114-square-meter unit at the Imun-dong Ssangyong complex is currently 1.24 billion won, only about 100 million won above the highest asking price of 1.15 billion won for a 59-square-meter unit. The broker added that buyers appear to weigh conditions such as floor level and the complex's location more heavily than unit size.
Relative prices for 59-square-meter units have also risen in the jeonse market. Across 60 identical complexes where both unit types signed new jeonse contracts in August 2021 and again in August this year, the deposit gap between 84- and 59-square-meter units narrowed to 17.0% from 26.6%, a decline of 9.6 percentage points. At Godeok Graceium in Gangdong-gu, the median jeonse deposit in 2021 was 740 million won for a 59-square-meter unit and 1.1 billion won for an 84-square-meter unit, a difference of 360 million won. This year the figures were 820 million won and 925 million won, narrowing the gap to 105 million won. At Sindorim Taeyoung Town, the gap between the two unit types shrank to 19.0% from 53.8%.
The strength of 59-square-meter units is attributed to higher housing costs and financial regulations. The higher a home's price, the lower the mortgage ceiling, and tighter stress debt service ratio rules have increased the equity burden for relatively expensive 84-square-meter units. Demand has also thickened among buyers choosing a 59-square-meter unit in areas with better access to jobs, transit and schools rather than a larger home on the city's outskirts for the same budget. A rise in one- and two-person households and improved floor plans for 59-square-meter units are also cited as factors lifting the value of smaller layouts.
