"Even with 1 billion won, there are no rooms," wife sighs... the pace of gains has changed

[Financial News]#. A new jeonse contract for an 84-square-meter unit at Lotte Castle Classia in Gil-eum-dong, Seongbuk District, Seoul, was signed in May for 1.1 billion won. That is the highest jeonse price ever recorded for this unit type. Local brokers said that although the complex has more than 2,000 households, jeonse listings have virtually disappeared.According to weekly apartment price data released by the Korea Real Estate Board (KREB) on the 11th, the jeonse price gains in the top three areas this year, through July 6, all exceeded 8%. Just two weeks earlier, on June 22, they were still in the 7% range.
KREB data show that from the end of last year through July 6, Gwangmyeong City recorded the largest jeonse price increase at 8.69%. It was followed by Seongbuk District, Seoul, at 8.61%, and Dongtan District, Hwaseong, Gyeonggi Province, at 8.42%. Nowon District at 7.94% and Seongdong District at 7.86% also posted gains in the 7% range.

The top three regions for jeonse price gains are in southern Gyeonggi Province and northern Seoul. Analysts say this reflects strong demand for relatively affordable jeonse homes. In Gwangmyeong, some had expected lease prices to weaken as large-scale new town move-ins began, but the outcome was the opposite.
Until recently, from the end of last year to June 22, the jeonse price gains in these three areas were still in the 7% range: 7.70% in Seongbuk District, 7.67% in Gwangmyeong City, and 7.58% in Dongtan District. As lease prices have risen more sharply lately, they have now broken through the 8% mark for the first time since last week.
What stands out is that while both sale and jeonse prices continue to rise, jeonse price gains have recently outpaced sale prices.
KREB data show that in Seoul, the weekly increase in jeonse prices has recently overtaken the rise in sale prices. Ko Jun-seok, a professor at Yonsei University, said, "In Seoul, sale prices had been rising relatively sharply," adding, "Recently, sale prices have kept climbing, but jeonse prices are rising even faster."
As a result, apartment sale prices in Seoul have risen 5.42% so far this year through July 6. Jeonse prices have also climbed 5.42%, meaning the pace of increase has now matched sale prices.
ljb@fnnews.com Lee Jong-bae Reporter