'Smart Single House' Syndrome Intensifies... Gangnam Apartment Prices Soar Again

[Financial News] The 'Smart Single House' syndrome is spreading nationwide. As the balance between housing demand and supply in high-grade and non-high-grade areas breaks, areas that rise continue to rise and areas that fall continue to fall, intensifying price polarization.
According to the Korea Real Estate Board's 'Weekly Apartment Price Trends for the 4th Week of May (as of May 26)', nationwide apartment sale prices have turned downward (0.00%→-0.02%), while the metropolitan area (0.03%→0.03%) maintained its increase, and the provinces (-0.04%→-0.06%) saw a larger decline. All regions except Seoul (0.16%), Sejong (0.10%), Jeonbuk (0.02%), and Chungbuk (0.00%) showed a downward trend. The metropolitan area maintained its increase (0.03%), but Incheon turned downward (0.00%→-0.04%), and Gyeonggi's decline (-0.01%→0.03%) widened.
More than anything, as the number of 'Smart Single House' buyers who want to invest in a single apartment with excellent location and product quality increases, the preference for high-grade areas such as Gangnam and Mayongseong (Mapo, Yongsan, Seongdong-gu) in the metropolitan area over the provinces is becoming prominent. Demand is concentrated around high-grade flagship apartments, leading to continued price increases even in ultra-high-priced complexes, resulting in polarization.
Seoul's increase expanded from 0.13% last week to 0.16%, continuing its upward trend for 17 consecutive weeks. Prices rose, led by apartments in the three Gangnam districts. Apartment prices rose in all 24 districts except Gangbuk-gu (0.00%).
In Gangnam-gu, a regulated area, prices rose by 0.13%p from 0.26% to 0.39%, ranking first in the autonomous districts' growth rate. It was followed by Songpa-gu (0.30%→0.37%) and Seocho-gu (0.32%→0.32%) in second and third place.
The Real Estate Board explained, "In Gangnam-gu, prices rose mainly around redevelopment projects in Apgujeong and Daechi-dong, in Songpa-gu around major complexes in Jamsil and Sincheon-dong, and in Seocho-gu around preferred complexes in Banpo and Seocho-dong."
Following the three Gangnam districts, Yangcheon-gu (0.22%→0.31%), Gangdong-gu (0.19%→0.26%), Mapo-gu (0.16%→0.23%), Yongsan-gu (0.16%→0.22%), Seongdong-gu (0.21%→0.18%), Yeongdeungpo-gu (0.16%→0.17%), Dongjak-gu (0.13%→0.17%), and Gwangjin-gu (0.11%→0.15%) showed high increases in that order.
The balloon effect is also spreading as the demand waiting to buy top-grade properties surges, and gap investment and real residence demand move to lower-ranked high-grade areas, leading to price increases. At the same time, regional disparities are deepening.
Even within Seoul, the growth rate varies greatly between regions such as the southeastern area (0.35%), downtown area (0.15%), southwestern area (0.13%), northwestern area (0.13%), and northeastern area (0.06%), as well as between the 14 districts in the north (0.08%) and the 11 districts in the south (0.23%).
Park Won-gap, a real estate specialist at KB Kookmin Bank, pointed out, "The unipolarization of Gangnam apartments is the core of the ultra-polarization phenomenon," adding, "As investments in buildings, multi-family, and multi-household properties also focus on apartments, Gangnam apartment prices are soaring." He continued, "Various factors such as asset portfolios diversified around tax and financial products unfavorable to multi-homeowners are leading to ultra-polarization in line with the 'Smart Single House' trend."

en1302@fnnews.com Jang In-seo Reporter