As Seoul Apartments Stall, "Balloon Effect" Drives 46% Rise in Villa Sales, 13% Jump in Rents [Real Estate AtoZ]

Dabang Analyzes Housing Transaction Volume from January to May This Year

As government regulations have focused on apartments, a "balloon effect" is emerging in the Seoul housing market, where buying and rental demand is shifting toward non-apartment homes.

A densely packed villa area viewed from Namsan, Jung-gu, Seoul. Photo by Kang Jinhyung

According to a July 16 analysis by real estate information platform Dabang, based on Ministry of Land, Infrastructure and Transport transaction data, there were 55,001 apartment jeonse (lump-sum deposit lease) transactions in Seoul from January to May this year. This represents a decrease of 24.5% compared to the same period last year (66,884 cases). Sales transactions also dropped by 1.4%, from 35,419 to 34,932, while monthly rent transactions fell by 3.9%, from 50,967 to 49,004.

The situation was exactly the opposite for the villa (townhouse/multi-family) market. During the same period, the number of transactions rose 45.8% from 13,215 to 19,273. Monthly rent transactions increased by 12.8%, from 34,104 to 38,455. Only jeonse transactions saw a 3.0% decrease, from 23,539 to 22,830—just one-eighth the drop seen in apartment jeonse deals (24.5%).

By district, villa transaction volume increased in all of Seoul's 25 districts. Gwangjin-gu saw the highest growth at 95.7%, followed by Songpa-gu at 82.4% and Yeongdeungpo-gu at 82.2%. In Gwangjin-gu, while apartment sales fell 43.2%, townhouse/multi-family sales rose 95.7%, highlighting a pronounced difference by housing type. Villa monthly rent transactions increased in 24 out of 25 districts—except Jung-gu, which edged down by 4.4%.

There was significant regional variation in apartment sales. Outer and lower-priced areas like Geumcheon-gu and Dobong-gu (95.6%), Nowon-gu (85.0%), Jungnang-gu (78.1%), and Gangbuk-gu (70.7%) saw a large increase in transactions. Conversely, hot spots like Seongdong-gu (-63.6%), Mapo-gu (-49.8%), and Gwangjin-gu (-43.2%) experienced a steep decline. Popular areas designated as land transaction permit zones (where occupancy requirements apply) were hit hardest, as demand for "moving up" was blocked. Apartment jeonse transactions increased in only one district, Jungnang-gu (12.1%), while the remaining 24 districts saw drops.

Comparison of apartment and villa (row house·multi-family) transaction volumes in Seoul from January to May this year. Top left and bottom left show sales, top right and bottom right show monthly rent transaction volumes. Dabang

By size, villas saw increases in both sales and monthly rent transactions across all size categories. The sharpest rise in sales was among medium-sized units—those over 85 m² and up to 102 m²—with an increase of 80.9%. Jeonse transactions rose only in two segments: units between 85 m² and 102 m² (up 11.1%) and those over 102 m² up to 135 m² (up 12.1%), while other segments declined.

For apartments, jeonse transactions fell across all size categories, while sales and monthly rent figures were mixed depending on the size. Sales of large units (over 135 m²) dropped the most, with a decrease of 26.3%—the largest among all size groups. However, monthly rent transactions for large-sized apartments were the only segment to increase, rising by 6.1%.

A Dabang official said, "The contrast between the Seoul apartment and townhouse/multi-family sales markets is becoming increasingly clear," adding, "With mortgage regulations tightening and a decline in apartment jeonse supply, demand is shifting from apartments to townhouse and multi-family units."

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