Over half of Seoul's property tax increase came from 3 Gangnam districts; Han River belt sees 43% jump in high-value homes

Seoul's housing property tax revenue rose by more than 500 billion won ($374 million) this year, with more than half of the increase coming from the three Gangnam districts — Gangnam-gu, Seocho-gu and Songpa-gu. Apartment prices along the Han River belt also surged sharply, pushing the number of homes with an assessed value above 1.2 billion won up more than 40 percent from last year.

Data submitted Sunday by the Seoul Metropolitan Government's tax division to the office of People Power Party lawmaker Kim Sang-hoon of the National Assembly's Finance and Economy Planning Committee showed that total housing property tax revenue in Seoul this year — including the property tax, urban area levy, local resource facility tax and local education tax — reached 3.9 trillion won, up 511.9 billion won, or 15.1 percent, from 3.38 trillion won last year.

The three Gangnam districts stood out in particular. Property tax billed to the three districts this year totaled 1.72 trillion won, accounting for 44.1 percent of the city's total. The three districts saw a combined increase of 292 billion won, or 20.5 percent, from 1.43 trillion won the previous year — representing 57 percent of the city's overall tax increase.

Breaking down the figures by district, Gangnam-gu collected 734.5 billion won in housing property tax this year, Seocho-gu 520.4 billion won and Songpa-gu 463.2 billion won — up 101.7 billion won, 101.3 billion won and 89 billion won, respectively, from the previous year.

While some ultra-luxury apartments in the Gangnam area have seen distressed sales at prices around 1 billion won below recent highs, most properties still command prices far above last year's levels. An 85-square-meter unit at DH Firstier Ipark in Gaepo-dong, Gangnam-gu, set a new high of 3.835 billion won in April — surpassing the previous record of about 3.5 billion won set in March last year.

An 84-square-meter unit at Ricenz in Jamsil-dong, Songpa-gu, similarly broke its own record, trading at 3.695 billion won in July, up from 3.6 billion won in November last year.

Homes with an assessed value above 1.2 billion won — the threshold for the comprehensive real estate tax for single-homeowner households — have spread well beyond the three Gangnam districts to encompass the entire Han River belt. That threshold is the basic deduction standard for the comprehensive real estate tax for single-homeowner households; applying this year's public housing price realization rate of 69 percent, it corresponds to a market price of about 1.74 billion won.

The number of homes in Seoul with an assessed value of at least 1.2 billion won jumped from 465,663 last year to 670,308 this year, an increase of 204,645 units, or 43.9 percent. Of those, 648,593 — or 96.8 percent of the total — were located in the 11 Han River belt districts: Yongsan, Seongdong-gu, Gwangjin-gu, Mapo, Yangcheon, Yeongdeungpo, Dongjak-gu, Seocho-gu, Gangnam-gu, Songpa-gu and Gangdong-gu.

The number of homes in the Han River belt with an assessed value of at least 1.2 billion won stood at 453,162 last year but jumped by 195,431 units, or 43.1 percent, in just one year. Analysts attribute the surge to a "price alignment" effect, as buyers push home values up to the maximum level eligible for mortgage loans under the government's tightened regulations — which cap total mortgage lending at 600 million won, with further restrictions of 400 million won for homes priced between 1.5 billion and 2.5 billion won and 200 million won for those above 2.5 billion won.

By district, Dongjak-gu recorded the steepest rise among Han River belt districts, with the number of qualifying homes jumping from 5,949 to 18,434 — an increase of 12,485 units, or 210 percent. Seongdong-gu saw 21,988 more units, rising from 14,877 to 36,865, a gain of 148 percent. Gangdong-gu climbed 137 percent, from 18,081 to 42,893, while Gwangjin-gu jumped 108 percent, from 9,348 to 19,429.

In Dongjak-gu's Heukseok-dong, a 66-square-meter unit at Hangang Hyundai traded at 1.65 billion won as recently as early last year, with some deals still below 1.7 billion won, but the unit set a new high of 2.25 billion won in January this year. In Seongdong-gu's Hawangsimnidong, a 59-square-meter unit at Centras traded at 1.6 billion won as recently as August last year but hit a new record of 2.1 billion won in June this year.