Property Listings Pile Up in the ‘Han River Belt’ Due to Property Tax Shock, but Buyers Wait for Further Price Drops [Real Estate AtoZ]

Concerns Over Rising Holding Tax Burden
Sell-Off Accelerates in Gangnam Area Throughout March
Gangnam District Listings Top 10,000, Making Up 14% of Seoul’s Total

In the high-end apartment clusters near the Han River in Seoul, property listings are piling up at a rapid pace. The pressure on homeowners to sell has intensified due to the reinstatement of heavier capital gains taxes for multiple-property owners and growing concerns over more realistic property holding taxes. However, with buyers expecting further price drops and choosing to wait, transaction activity remains sluggish. As more urgent sales with reduced prices continue to appear in certain complexes, experts predict that the release of new listings will persist for some time, now that the tax burden has become a reality.

According to real estate big data company Asil on March 19, the areas with the largest increase in listings among Seoul’s districts in March were concentrated around the Han River. In Gangdong District, the number of listings rose from 3,800 to 4,384—a 15.3% increase, the highest rate among the districts. This was followed by Seocho District (14.6%), Gangnam District (14.1%), Seongdong District (12.5%), Yangcheon District (10.8%), and Dongjak District (10.4%). Gangnam District accounted for about 14% of all listings in Seoul, with a total of 10,626. Songpa District also saw an 8.6% increase, from 5,366 to 5,832 listings.

These areas, often referred to as the "Han River Belt," are densely populated with high-priced apartments and are known for heavy property tax burdens due to rising officially assessed property values. After President Lee Jaemyung mentioned the end of the capital gains tax exemption for multiple-property owners at the end of January, listings began to increase across Seoul, with the trend recently becoming more pronounced in areas facing higher tax burdens. A real estate agent near Songpa District commented, "Initially, there was little concern about the property holding tax, but recently, more owners are deciding it is better to sell than to keep multiple properties."

Following the Ministry of Land, Infrastructure and Transport’s announcement of the officially assessed prices for apartment complexes on March 17, new listings have also surged. According to the Ministry, Seoul’s officially assessed prices for this year jumped by 18.7% compared to the previous year—the highest rate since 2021 (19.91%). By district, Seongdong (29.04%), Gangnam (26.05%), Songpa (25.49%), and Seocho (22.07%) recorded the largest increases. These districts, adjacent to the Han River Belt and filled with luxury residences, are inevitably facing greater tax burdens due to the increase in officially assessed prices, which serve as the basis for property taxation.

Yonhap News Agency

In fact, following the announcement of the new officially assessed prices, over 10 new listings for 59㎡ and 84㎡ units at "Yeoksam E-Pyunhan Sesang" in Yeoksam-dong, Gangnam District, were registered within three days. Most of these were urgent sales. Among the existing listings, there were several cases where prices were reduced by 10 million to 50 million won. One 59㎡ unit was listed at 2.69 billion won, which is 160 million won lower than its initial listing price of 2.85 billion won on February 24. A real estate agent near Gangnam District said, "Listings from multiple-property owners have started to come out in earnest, and with the added burden of property holding taxes, the number of listings has steadily increased since last month. Prices are being reduced by 10 to 20 million won, but buyers are still waiting for prices to fall to their target levels."

Experts believe that rising officially assessed prices are likely to stimulate an increase in property listings. Ham Youngjin, Head of Real Estate Research at Woori Bank’s WM Business Strategy Department, said, "Rather than leading directly to a drop in housing prices, the increase in officially assessed prices is more likely to encourage more listings. If the property tax reform in July includes an increase in the effective property holding tax rate, sales by multiple-property owners or those with high-value homes may increase as they seek to reduce their tax burden."

However, some analysts say it is too early to conclude that the overall market has shifted into a full-scale downturn. The reason is that price adjustments are mostly limited to urgent sales, while overall transaction volume remains low. Ham added, "In the short term, price adjustments will likely center on urgent sales with limited transactions." A real estate agent near Banpo-dong, Seocho District, said, "With the designation of the land transaction permit zone taking effect next month, it may become even harder to transact, so the current prices may be the last adjustment. Many multiple-property owners are thinking that if they can’t sell at these prices, they’ll just hold on to their properties, so a steep price drop is unlikely."

This content was produced with the assistance of AI translation services.