Seoul apartment prices are climbing again as the reinstatement of capital-gains taxes for multiple-home owners removes tax-avoidance listings from the market [1].
This trend indicates a tightening housing supply that pressures both buyers and renters in the South Korean capital. The shift suggests that tax policy is directly influencing market availability, pushing prices upward as sellers withdraw properties to avoid higher tax burdens.
The impact is particularly evident in the rental market. The increase rate for jeonse, South Korea's unique lump-sum deposit rental system, has reached its highest level in 10.5 years [1].
In the Seocho-gu district, the effect on supply is stark. In a large-scale apartment complex consisting of approximately 3,000 units, the number of available listings has plummeted [1]. Two weeks ago, there were over 500 listings available; that number has since fallen to about 250 [1].
Real estate professionals note that the lack of urgency among sellers is contributing to the scarcity. Kang Chul-soo, a realtor in Seocho-gu, said that sellers, including those with single homes that are currently rented, are not in a hurry to sell [1].
This behavior has left buyers with fewer options, further accelerating the price surge. The disappearance of "tax-saving" properties — those listed specifically to avoid higher tax brackets — has left a gap in the market that is now being filled by higher asking prices [1].
“Jeonse rental price growth hits a 10.5-year high.”
The current market volatility in Seoul demonstrates the high sensitivity of the real estate sector to fiscal policy. By reinstating higher capital-gains taxes on multiple-home owners, the government has inadvertently incentivized owners to hold onto properties rather than sell. This creates a supply squeeze that drives up both purchase prices and rental costs, potentially increasing the cost of living for residents who do not already own property.
