Apartment buildings in Seoul [Yonhap]
Apartment buildings in Seoul [Yonhap]

As commercial banks tighten mortgage lending standards, buying patterns in Seoul's apartment market are shifting. Transactions in the 1 billion to 1.5 billion won range are cooling, while demand moves toward lower-priced apartments under 1 billion won — driving a string of record-high deals in outer Seoul districts such as Nowon-gu, Dobong-gu and Gangbuk-gu, collectively known as "Nodo-gang."

According to the Ministry of Land, Infrastructure and Transport's actual transaction price disclosure system, a series of record-high deals were recently recorded in small- to mid-sized apartments with exclusive use areas of around 59 square meters in the Nowon, Dobong and Gangbuk districts.

A 59-square-meter unit at the Miryung·Misung·Samho 3rd complex in Wolgye-dong, Nowon-gu, sold for 1.11 billion won on June 26, setting a new all-time high for the building. A 59-square-meter unit at Wolgye Central I'Park in the same neighborhood also set a record, changing hands for 1.08 billion won on June 23.

Gangbuk-gu and Dobong-gu showed similar trends. A 59-square-meter unit at Songcheon Centreville in Songcheon-dong, Gangbuk-gu, surpassed its previous record when it sold for 1.05 billion won on May 23, while a 59-square-meter unit at Samsung Raemian Trivera 2 in Mia-dong fetched 970 million won on June 3, also a new high.

In Dobong-gu, a 59-square-meter unit on the fifth floor of Jugong Complex 19 in Changdong sold for 895 million won on June 4 — more than 100 million won above the 770 million won paid for a sixth-floor unit of the same size in late 2025, and approaching the complex's all-time peak of 920 million won set in 2021.

Market observers say tightened lending rules are driving the shift. KB Kookmin Bank cut its mortgage loan ceiling from 600 million won ($433,000) to 300 million won, and as the broader financial sector has followed suit, owner-occupiers with limited financial capacity are increasingly turning to lower-priced apartments on the outskirts of Seoul.

Additional factors supporting buying activity in outer districts include persistent homeownership demand fueled by concerns over a citywide supply shortage and rising jeonse ("long-term deposit lease") prices, as well as increased market liquidity from performance bonuses paid out in the semiconductor industry.

The surge in transaction volume is also most pronounced in outer Seoul. According to the Supreme Court Registry Information Plaza, ownership transfer registrations for collective buildings — a proxy for apartment sales — filed in the first half of this year rose 109.6 percent year-on-year in Jungnang-gu, the highest increase in the city. Eunpyeong-gu followed at 87.9 percent, then Gangbuk-gu at 72.4 percent, Gwanak-gu at 49.9 percent and Dobong-gu at 48.9 percent. By contrast, Gangnam-gu posted a decline of 19.8 percent and Seocho-gu fell 0.37 percent.

Experts say that if lending restrictions persist, the migration of demand toward outer Seoul and lower-priced areas of the greater metropolitan area will become even more pronounced.

Ko Jong-wan, head of the Korea Asset Management Research Institute, said that when mortgage limits shrink, buyers naturally move to outer Seoul or further out into Gyeonggi Province and Incheon. "During the last housing price boom, many young, non-homeowning buyers were taking out loans to purchase homes," Ko said. "This round of lending restrictions will similarly help spread demand into less-regulated, more affordable areas of the metropolitan region and northern Gyeonggi Province."

Experts caution, however, that it is too early to determine whether the price gains in outer districts reflect genuine end-user demand or a short-term spillover effect. Should further lending restrictions and expanded housing supply policies follow, the current price strength concentrated in outer Seoul could enter a new phase, analysts said.


rainbow@heraldcorp.com