Minister cites growing housing inventory and falling transactions as signs of a potential price decline

'Outer Seoul slowing, rate hike could widen drop'

Rental market instability to be addressed with more Greater Seoul supply

Land Minister Hong Ji-sun presents the 2027 budget proposal and fund management plan at a plenary session of the National Assembly's Land and Infrastructure Committee on Thursday. [Yonhap]
Land Minister Hong Ji-sun presents the 2027 budget proposal and fund management plan at a plenary session of the National Assembly's Land and Infrastructure Committee on Thursday. [Yonhap]

Land Minister Hong Ji-sun said Thursday that a continued buildup of housing inventory and a drop in transactions "can be seen as a signal that home prices may be entering something of a downturn."

Hong made the remarks at the seventh plenary session of the National Assembly's Land and Infrastructure Committee, responding to a question from People Power Party lawmaker Kim Mi-ae, who asked what basis the minister had for saying there were "hopeful signs of housing price stabilization."

Hong said prices in the three Gangnam-area districts — Gangnam, Seocho and Songpa — "have already been falling consistently," while the pace of gains in outer Seoul is slowing. Hong added that if the benchmark interest rate rises by year-end, the decline could widen.

On instability in the jeonse and monthly rent market, Hong said the government would "continuously expand the supply of rental housing, particularly in the greater Seoul area, as sufficient housing supply is the fundamental solution."

Hong rebuffed Kim's suggestion that the government was focused solely on falling prices in the three Gangnam districts, saying, "That is not the case at all."

Asked about President Lee Jae Myung's recent remarks that home prices in major areas were falling at a surprising pace, Hong said the president's intent was to call for "balanced reporting" — acknowledging that prices in outer Seoul were rising while noting that prices in key areas including Gangnam and Yongsan were falling.

Meanwhile, data released Thursday by the Korea Real Estate Board showed Seoul apartment prices rose 0.07 percent in the second week of November, based on figures as of Sunday, marking 92 consecutive weeks of gains. However, the three Gangnam-area districts continued to decline, and Gangdong-gu and Seongdong-gu also turned negative this week.


hss@heraldcorp.com