Seoul apartments must top W4.65b to rank in top 1%

Buying a top-1-percent apartment in Seoul now requires at least 4.65 billion won ($3.12 million), according to new data released Monday. With the government moving to impose a steeper property-holding burden on owners of ultra-high-priced homes, attention is turning to where exactly the threshold will be set.

Real estate platform Zigbang said Monday that its analysis of first-half transaction data showed the entry price for Seoul's top 1% of apartment deals stood at 4.65 billion won.

The entry price refers to the minimum transaction price needed to be included in the top 1% of all apartment deals recorded in a given region.

Price gaps between Seoul and other regions in the top-1-percent segment reached as much as ninefold. Gangwon Province and North Gyeongsang Province came in at the 500 million to 600 million won range, while entry prices elsewhere were: Gyeonggi Province at 1.85 billion won, Daegu at 1.58 billion won, Busan at 1.525 billion won and Sejong at 1.28 billion won.

A Zigbang official said that while both markets fall within the top 1%, the Greater Seoul area sees high-end transactions spread across a wide range of complexes, whereas in regional cities deals tend to concentrate around landmark complexes that define the local market.

Average transaction prices in the top 1% segment came in even higher than the entry thresholds. On an average-price basis, Seoul exceeded 6.3 billion won and Gyeonggi Province topped 2.2 billion won. Busan was in the high 2.1 billion won range, while Daegu was around 1.9 billion won.

Zigbang noted, however, that the top-1-percent apartment market has shown signs of stabilizing compared with last year. Seoul's top-1-percent entry price peaked at 4.98 billion won in the first half of last year before easing slightly to 4.65 billion won in the first half of this year.

The average transaction price in the segment also fell, from 6.88 billion won in the first half of last year to 6.31 billion won in the first half of this year. Zigbang attributed the decline to the government's sustained tightening of regulations, which has weighed on transactions in the high-priced apartment segment.

A Zigbang official said high-end deals in Seoul are concentrated along the Han River waterfront and in premium reconstruction and newly built complexes, while in Gyeonggi Province they cluster in areas with strong access to Seoul or self-sufficient urban functions — including Gwacheon, Seongnam's Bundang, Pangyo, Gwanggyo and Dongtan. The official added that high-priced transactions are occurring across a growing number of areas, broadening the reach of the Greater Seoul top-1-percent market.

Meanwhile, the government has signaled a targeted tax increase on ultra-high-priced homes. Kim Yong-beom, the presidential chief of staff for policy, appeared on KBS's Sunday Diagnosis program on Sunday and said that "even a single home for actual residence must be viewed differently if it is ultra-high-priced real estate," while stopping short of naming a specific threshold, saying the government would "listen extensively to public opinion on what an appropriate price level should be."