"If They Don't Sell, That's the End": Multiple-Home Owners Begin Their Counteroffensive

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[The Financial News] As the end of the temporary suspension of heavy capital gains tax on multiple-home owners approaches, a clear shortage of listings is emerging in Seoul's apartment market. Despite expectations of tax relief, sellers are increasingly pulling properties off the market and holding out in hopes of further price gains.
According to the real estate industry on the 27th, as of that day, apartment sale listings in Seoul had fallen in all 25 districts over the past month. Contrary to market expectations that more homes would be put up for sale, listings declined simultaneously across every district.
The declines were also steep. Jungnang-gu posted the sharpest drop at 16.9%, while Nowon-gu and Gangbuk District each fell 13.4%, marking double-digit declines. Listings also dropped quickly in major areas such as Guro District (-12.9%), Dongjak District (-11.5%), and Seongdong District (-11.1%).
The Gangnam area was no exception. Listings in Gangnam District fell 9.1% over the month, and Seocho District dropped 4.0%. Yongsan District (-0.9%) and Yeongdeungpo District (-1.5%), which had shown slight increases until the previous day, also turned downward, leaving no district with rising listings.
The South Korean government introduced a supplementary measure to apply the temporary suspension of heavy capital gains tax on multiple-home owners to applications filed by May 9, taking into account administrative delays in land transaction permit zones. But the market response has been limited. Analysts say sellers are prioritizing price expectations over tax burdens, so the policy has not led to more listings.
Lee Eun-hyung, a researcher at the Korea Research Institute for Construction Policy (RICON), said, "Among multiple-home owners, there are not enough people ready to sell immediately because the end of the tax suspension alone is not enough to change the market direction." He added, "Once the suspension ends, the heavier tax burden will apply anyway, so selling in a hurry would simply lock in losses. That gives them little reason to put their homes on the market."
He also noted, "The earlier increase in listings may have reflected seasonal factors such as spring moving demand." He added, "It is hard to say that the suspension policy alone caused a large wave of new listings."
The decline in listings is also affecting prices. According to the Korea Real Estate Board (KREB), as of the third week of April (the 20th), Seoul apartment sale prices rose 0.15% and jeonse prices climbed 0.22%, extending their upward trend. Some areas in Gangnam showed weakness, but prices continued to rise in outlying and mid- to low-priced districts. As long as price expectations remain firm, sellers are likely to keep waiting and the shortage of listings is expected to continue for now.
en1302@fnnews.com Jang In-seo Reporter