After the reinstatement of heavier capital gains taxes, sales also plunged, but the share of record-high transactions rose to one in six [Jeonse transactions cut in half]

Apartment transactions in Seoul fell to their lowest level in the past year in May, after the grace period for heavier capital gains taxes on multiple-home owners ended. Even so, record-high deals accounted for one in six transactions.
According to the Ministry of Land, Infrastructure and Transport's Actual Transaction Price Disclosure System, 4,512 apartment sales in Seoul were reported on the first day of the month. That was down 46.4% from the previous month’s 8,422 transactions, effectively cutting trading volume in half. The figure is similar to July, when 4,148 transactions were recorded shortly after the June 27 Loan Regulations took effect last year, and to November, when 3,389 transactions were logged soon after the October 15 housing measures expanded land transaction permit zones across Seoul. However, because the reporting deadline can be as long as 30 days, the final tally may rise further.
Transactions were concentrated just before the grace period for heavier capital gains taxes ended on May 9. Of the month’s total, 2,318 deals, or 51%, were completed between May 1 and 9, before the exemption expired. The surge appears to have reflected multiple-home owners trying to sell before their tax burden increased, as well as buyers rushing to close deals before the heavier tax took effect. As a result, transactions dropped sharply after the tax hike was reinstated.
Although trading volume plunged, record-high transactions continued. Of the 4,512 apartment deals in Seoul in May, 736 set new price highs. That accounted for 16.3% of all transactions, or roughly one in six homes.
By district, Yeongdeungpo District stood out the most. Of 148 transactions there, 57 were reported at record highs, accounting for 39%. That means about two out of every five homes sold at a new high. It was followed by 61 of 192 transactions in Dongdaemun District (32%), 45 of 153 in Dongjak-gu (29%), 19 of 69 in Seongdong District (28%), and 14 of 53 in Yongsan District (26%).
Looking only at transactions after the heavier capital gains tax was reinstated, the share of record-high deals was even higher. In Yeongdeungpo District, 34 of 60 transactions after the policy took effect, or 57%, were at record highs. In Seongdong District, 7 of 16 deals, or 44%, set new highs, while in Dongjak-gu, 20 of 50 transactions, or 40%, reached record levels.
Record-high transactions were also common in the three Gangnam districts. In Gangnam District, 16 of 59 transactions, or 27%, were at record highs. Seocho District posted 16 of 56, or 29%, while Songpa District recorded 30 of 97, or 31%. That means roughly one in three homes in the area set a new high.
Park Won-gap, a senior real estate expert at KB Kookmin Bank, said, "There is still time left in the reporting period, so transaction volume could increase." He added, "The high share of record-high deals appears to reflect continued buying from the MZ generation, or 'active buyers,' especially in non-Gangnam areas where the loan burden is relatively lighter."
Yoon Su-min, a senior real estate expert at Nonghyup Bank, said, "Since a significant portion of listings from multiple-home owners were absorbed before the heavier capital gains tax took effect, it will be difficult for transaction volume to rise sharply." He forecast that "in the second half, record-high deals could expand, especially in non-Gangnam areas, as a shortage of listings takes hold."
going@fnnews.com Choi Ga-young Reporter