Despite the government's stringent management of household loans, housing transactions in Seoul increased in the first half of this year compared to last year. The rise is attributed to demand supported by funds from stock and bond sales, as well as gifts and inheritances, referred to as 'non-loan funds.'
According to the Korea Construction Policy Institute, as of May this year, the balance of mortgage loans from deposit-taking institutions and the Korea Housing Finance Corporation and Housing City Fund was approximately 1,261 trillion won, reflecting a modest 0.2% increase from the previous month. This growth rate is half of the average monthly increase of around 0.4% observed this year.
The government continues to maintain a policy of loan restrictions, aiming to keep the growth rate of household loans in the financial sector within 1.5%. Specific management targets for mortgage loans have also been implemented, raising the threshold for new loans for home purchases.
In contrast, the Seoul housing market has shown a different trend. The Ministry of Land, Infrastructure and Transport reported that nationwide housing transactions from January to June reached 396,274, a 10.6% increase compared to the same period last year. In the metropolitan area, transactions rose by 13.4%, while Seoul saw an 8.2% increase, with a total of 69,032 transactions in the first half of the year.
However, apartment transactions in Seoul decreased by 2.8% year-on-year, totaling 42,186. In June, overall housing transactions in Seoul fell to 12,094, a 14.5% decrease from the previous month, while apartment transactions dropped by 13.5% to 7,742. The increase in overall transactions in the first half of the year was largely driven by non-apartment properties such as multi-family homes.
Despite variations in transaction types, the upward trend in housing prices in Seoul continues. In June, the average sale price of apartments rose by 1.2% from the previous month, marking 27 consecutive months of increases since April 2024. The apartment sales supply-demand index in Seoul stood at 112.6, indicating that buyer demand continues to outpace supply.
Market analysts are paying attention to the flow of funds that cannot be explained solely by loans. According to the Ministry of Land, Infrastructure and Transport, funds utilized for purchasing homes in Seoul from the sale of stocks and bonds amounted to 23.966 trillion won from July last year to January this year.
Last year's total from stock and bond sales reached 38.916 trillion won, a 72.6% increase from 22.545 trillion won in 2024. This suggests that as loan limits tightened, buyers turned to liquidating financial assets to cover the shortfall in home purchase funds.
Nam Hyuk-woo, a researcher at Woori Bank, explained, "The asset income generated from liquidating securities can flow into the real estate market at any time."
Funding through gifts and inheritances has also seen a significant increase. In the first quarter of this year, 2.1813 trillion won was used for home purchases in Seoul from gifts and inheritances. Of this amount, 1.0915 trillion won, or 50.0%, was sourced from individuals in their 30s. During the same period, individuals in their 30s also generated the highest amount of home purchase funds, totaling 721.1 billion won, from the sale of stocks, bonds, and virtual assets.
Analysts suggest that loan regulations are not uniformly blocking demand in Seoul but rather widening the gap based on funding capabilities. Those who can mobilize financial assets or family support remain active in the market, while those heavily reliant on loans may find it increasingly difficult to enter.
Gu Ja-min, a researcher at Real Today, noted, "The purchasing power of individuals in their 30s has significantly depended on returns from emerging asset markets. As housing prices rise, creating higher entry barriers, young buyers are leveraging not only loans but also investment returns and parental support to make purchases."
* This article has been translated by AI.
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