Cumulative gain of 14.73% surpasses Moon, Roh governments; outer-district prices lead surge

Seoul Mayor Oh Se-hoon. [Yonhap]
Seoul Mayor Oh Se-hoon. [Yonhap]

Seoul Mayor Oh Se-hoon called Sunday for a sweeping review of the government's real estate policy, saying Seoul apartment prices have risen for 86 consecutive weeks — surpassing the longest streak recorded under the Moon Jae-in administration.

Oh made the remarks on his Facebook page, saying Seoul apartment prices had climbed for 86 straight weeks, breaking the previous record of 85 weeks set under the Moon government. "What is even more serious is the intensity of the rise," he said.

He said the cumulative monthly increase in Seoul apartment sale prices during the first year of the Lee Jae Myung administration stood at 14.73 percent, far exceeding the 11.68 percent recorded under the Roh Moo-hyun government and the 9.41 percent under Moon. "The duration of the rise is the longest on record, and the pace of price increases in the early days of this administration has already surpassed those of past governments," he said.

Oh said the surge was particularly pronounced in non-Gangnam areas and outer districts, beyond the traditional strongholds of Gangnam, Seocho and Songpa-gu.

He said Seoul apartment sale prices rose an average of 3.5 percent between June and August, but Dongdaemun-gu climbed 5.8 percent, Geumcheon-gu 5.4 percent, Dobong, Gangseo and Gangdong-gu 4.7 percent, and Nowon-gu 4.3 percent. "A so-called 'price-leveling' phenomenon is becoming increasingly visible, centered on non-Gangnam and outer areas of Seoul," he said.

Oh said jeonse prices followed a similar pattern. While the Seoul average rose 3.5 percent over the same period, Seongbuk-gu climbed 6.0 percent, Jungnang-gu 5.5 percent, Nowon-gu and Guro-gu 5.0 percent, Gangbuk-gu 4.8 percent, and Seodaemun-gu 4.7 percent. "Even jeonse prices are far outpacing the Seoul average in areas where working-class residents and younger generations tend to live," he said.

Oh attributed the trend to loan regulations and tax policy. He said tightening lending rules had suppressed demand in central areas, pushing it toward lower-priced outer districts and ultimately driving up both sale and jeonse prices there at the same time.

He criticized the government's approach as one fixated on owner-occupancy and tax-based controls, saying the policies had failed to rein in prices and instead lifted the price floor across all of Seoul by one notch.

Oh said newlyweds and young people who had hoped to buy their first home in more affordable outer parts of Seoul were "facing frustration once again before a broken housing ladder," while retirees who had spent decades in their neighborhoods were worried they might have to leave because of the tax burden.

He warned that the government would be making a serious mistake if it focused only on signs that price growth in parts of Gangnam had slowed. "We need to look at the full picture — whether young people are being priced out of Seoul, whether families raising children can stay in their neighborhoods, and whether retired parents are being forced out of homes they have lived in their whole lives because of taxes," he said.

"You cannot claim to have stabilized housing prices while pushing people out of their homes," Oh said, calling on the government to conduct a full review of real estate policy across all three pillars: supply, lending and taxation.


quq@heraldcorp.com