Seoul Officetel Transactions Fall 21.6%, but 40–60-Sq.-M. Transactions Rise 8.9%

[Financial News] Seoul officetel transactions fell by more than 20% in a year, while transactions for units with an exclusive area of 40–60 sq. m. increased, a report found. Transactions for micro-sized officetels dropped sharply, while the share of transactions for medium-sized units with relatively more living space grew.
An analysis of Ministry of Land, Infrastructure and Transport transaction-price data by real estate platform Zigbang on the 26th found that, last September, units larger than 40 sq. m. accounted for 38.4% of individual purchases of officetels nationwide, up 3.3 percentage points from 35.1% in the same month a year earlier.
Individual purchases nationwide fell 20.7%, from 2,536 to 2,010 transactions. Transactions for units larger than 40 sq. m. declined 13.2%, from 889 to 772. As overall transactions fell, transactions for relatively larger units declined less, increasing their share of individual purchases.
Changes in transactions by floor area were more pronounced in Seoul. Individual purchases of Seoul officetels totaled 581, down 21.6% from 741 in the same month last year. By contrast, transactions for units measuring 40–60 sq. m. rose 8.9%, from 90 to 98.
The share of Seoul officetel transactions involving units larger than 40 sq. m. rose 5.3 percentage points, from 22.8% in September last year to 28.1% this September. This was the highest level in the past year. In terms of transaction count, that represented 163 of the 581 total transactions this September.
By floor area, transactions for units measuring 20–30 sq. m. showed the sharpest decline. Individual purchases fell 31.6%, from 326 in September last year to 223 this year. Their share of all transactions also dropped 5.6 percentage points, from 44.0% to 38.4%.
By contrast, units measuring 40–60 sq. m. gained both in transaction volume and share. Their share of all individual purchases rose 4.8 percentage points over the same period, from 12.1% to 16.9%. The share of transactions for units measuring 60–85 sq. m. also increased, from 5.9% to 7.1%.
The share for units larger than 85 sq. m. fell from 4.7% to 4.1%. This suggests that rather than transactions increasing across larger officetels generally, demand held up relatively well for units in the 40–60-sq.-m. range.
The share of transactions for units larger than 40 sq. m. rose not only in Seoul but also in Gyeonggi Province and Incheon. In Gyeonggi Province, it increased 1.5 percentage points, from 42.5% in September last year to 44.0% this year. In Incheon, it grew 3.4 percentage points over the same period, from 56.3% to 59.7%.
Busan saw the biggest change outside the capital region. The share of individual purchases in Busan involving units larger than 40 sq. m. rose 13.0 percentage points, from 27.1% to 40.1%. However, the actual number of transactions was the same in both years, at 61. The increase in share resulted from a decline in overall transactions.
Differences by floor area were also evident in sale prices. According to the third-quarter officetel price trend survey released by the Korea Real Estate Board on the 15th, Seoul officetel sale prices rose 0.07% from the previous quarter.
Prices for units of 40 sq. m. or less fell 0.06%, while those for units larger than 40 sq. m. and up to 60 sq. m. rose 0.21%. Prices increased 1.07% for units larger than 60 sq. m. and up to 85 sq. m., and 1.57% for units larger than 85 sq. m., with larger units recording relatively higher gains.
A Zigbang official said, “As apartment prices and housing costs continue to rise, interest may grow in officetels that can provide the space needed for actual living.” The official added, “It is difficult to conclude that changes in transactions mean apartment demand is shifting to officetels; transaction patterns may also vary depending on regional officetel supply structures, inventory by floor area, price levels and other factors.”

[email protected] Choi A-young Reporter