A mixed-use apartment complex in Gangnam-gu, Seoul. [Herald DB]
A mixed-use apartment complex in Gangnam-gu, Seoul. [Herald DB]

More than 4,700 apartments in Seoul are set to open for move-in during August — the highest monthly figure of the year — but analysts say the surge is unlikely to ease the jeonse and monthly-rent crunch anytime soon, as supply is heavily concentrated in a few areas and a sharp drop-off in future move-ins looms ahead.

According to real estate data firm Budongsan114, a total of 19,272 units across 36 apartment complexes nationwide — including rental units — are scheduled for move-in next month. Of those, 11,746 units are in the Greater Seoul metropolitan area, led by Gyeonggi Province (5,729 units), Seoul (4,770 units) and Incheon (1,247 units).

Some 43 percent of Seoul's August move-in supply comes from the Banpo Raemian Trinione complex (2,091 units) in Banpo-dong, Seocho-gu. The complex rises up to 35 stories across 17 buildings and was built by Samsung C&T's construction division through the reconstruction of Banpo Jugong 1 Complex, Zone 3. On July 10, a move-in rights contract for a 112.08-square-meter unit on the 21st floor traded at 6.9 billion won ($4.71 million). Elsewhere, Magok, Gwangheungchang and Wangsimni are among the areas slated to receive long-term jeonse and youth-designated housing move-ins.

Even as Seoul's apartment move-in volume hits its highest point of the year in August, analysts expect the impact on the sales and lease markets to remain limited.

Seoul is on track to see a total of 25,281 apartment units move in this year, down 11,822 units from last year's 37,103. The concern lies further ahead: move-in supply is projected to keep shrinking, with 18,682 units expected in 2027 and 13,683 in 2028.

A property listing board at a real estate agency in Gangnam-gu, Seoul. [Herald DB]
A property listing board at a real estate agency in Gangnam-gu, Seoul. [Herald DB]

The disparity across districts is stark. Move-in supply is heavily skewed toward a handful of areas — Seocho-gu leads with 5,958 units, followed by Songpa-gu with 2,572 and Jungnang-gu with 1,950 — while Seodaemun-gu (487 units), Gangnam-gu (349 units) and Dobong-gu (299 units) are comparatively underserved. Yongsan, Jongno and Gwanak-gu are set to receive no new apartment move-ins at all.

Kim Ji-yeon, a senior researcher at Budongsan114, said the near-term increase in move-in volume could temper lease price gains in supply-heavy areas such as Banpo, but warned that "if tightening jeonse loan regulations and other government policy measures coincide with a decline in move-in supply, it will be difficult to stabilize the jeonse and monthly-rent market over the medium to long term."

The supply squeeze appears to be stoking home-buying sentiment. The Bank of Korea's consumer sentiment survey for July, released Tuesday, showed the housing price outlook index rose 7 points from the previous month to 127 — the highest reading since September 2021 (128), during the fifth year of the Moon Jae-in administration, and a level not seen in four years and 10 months. The survey was conducted from July 13 to July 21 and drew responses from 2,247 households nationwide.

The result is widely interpreted as reflecting a prevailing view that government regulations or interest rate hikes are unlikely to quickly cool rising home prices, even as apartment sale and jeonse prices climb across Seoul and the broader metropolitan area. Lee Heung-hu, head of the Bank of Korea's economic sentiment survey team, said "the recent broadening of home price gains has influenced consumers' housing price expectations," adding that "as monetary tightening pushes up lending rates and commercial banks tighten loan limits, we need to watch how that feeds through to housing price sentiment with a lag."

Market attention is turning to a tax reform package and comprehensive real estate measures expected to be announced as early as the end of this month. Ha Jun-kyung, senior presidential secretary for economic growth at Cheong Wa Dae, signaled Monday that an announcement was imminent, saying the government "is also preparing measures that can accelerate short-term supply" in connection with jeonse and monthly-rent stabilization efforts.


lucky@heraldcorp.com