'Even after retirement, no worries about money'... Changing Asset Growth of Wealthy Individuals [Real Estate A to Z]

[Financial News] #.A representative of a building brokerage firm recently received strong complaints from a customer. This was because he recommended a 6 billion won small building to a wealthy individual who was considering an apartment. The representative said, "The customer was angry as the price of the high-priced apartment they intended to buy had skyrocketed," adding, "This is the first time I've experienced such a situation."

On the 27th, Financial News analyzed and compared transactions of apartments (over 5 billion won) and small buildings (under 10 billion won) in the Seoul area, revealing that the saying 'landlord above the creator' is becoming outdated. This is because the main investment destination for wealthy individuals is shifting from small buildings to high-priced apartments in Gangnam.
For the Seoul area, apartments over 5 billion won were analyzed using data from the Ministry of Land, Infrastructure and Transport, and transactions of small buildings under 10 billion won (with a total floor area of less than 10,000㎡) were analyzed by consulting with a building specialist firm, Realty Korea. Small to medium-sized buildings under 10 billion won are the most popular products.
According to the analysis, even from 2020 to 2022, the number of small building transactions exceeded 1,000 in the first quarter. In contrast, transactions of apartments over 5 billion won were only 6 in 2020, 47 in 2021, and 32 in 2022. In short, small buildings were overwhelmingly chosen by wealthy individuals.
Park Won-gap, a senior real estate expert at KB Kookmin Bank, said, "Small buildings were a dream for retirees and a typical investment destination where the surplus funds of the wealthy gathered," diagnosing, "However, this trend is changing recently."
In fact, from 2023 onwards, transactions of small buildings under 10 billion won have sharply decreased, while transactions of apartments over 5 billion won have surged. According to statistics, transactions of Seoul apartments over 5 billion won were 21 in 2023, 50 in 2024, and a whopping 232 this year, more than quadrupling in a year. In contrast, transactions of small buildings under 10 billion won fell from 320 to 504, and 527 during this period, to just half of the previous level (over 1,000).
Data indicating that the preferred real estate of wealthy individuals is changing also comes from other sources. KB Management Research Institute conducts a survey on preferred real estate among wealthy individuals every year. According to the recently published '2025 KB Real Estate Report,' 64% of high-net-worth individuals chose apartments as their investment destination last year. The proportion choosing offices and shops was only 28%. From 2020 onwards, the proportion choosing apartments exceeded 60%, and the proportion choosing offices and shops fell below 30% for the first time.
Experts analyze that the decrease in the popularity of small buildings is partly due to the increase in vacancies caused by high interest rates and economic recession, reducing their investment appeal. Above all, it is analyzed as a phenomenon caused by the 'Gangnam apartment unipolarization.' Gangnam's ultra-high-priced apartments are comparable to the price of most small buildings.
Park said, "Due to the invincibility of Gangnam apartments, apartments in affluent areas have now become a symbol of wealth, replacing buildings." A representative of Realty Korea said, "Once apartments reach a certain peak, demand is expected to shift back to small buildings."



ljb@fnnews.com Lee Jong-bae Reporter