How long will the Jeonse/Wolse market instability last? What are the real estate variables for the second half of the year?_26.05.29. | Jeong Bo-hyeon, NH Investment & Securities Tax Center Department Head [Morning N Investment]

Summary

NH Investment & Securities Tax Center Department Head Jeong Bo-hyeon discusses the current Korean real estate market, noting that while price increases have slowed, they are still rising, especially for jeonse (lump-sum deposit rental). He analyzes the impact of the May 9 resumption of heavier capital gains taxes on multi-homeowners, the upcoming local elections, and potential tax law changes in July. The severe shortage of new housing supply over the next three years is identified as a key driver of upward price pressure. He also compares the housing policies of the two main Seoul mayoral candidates, finding them similar in their push for more supply.

• Seoul apartment prices continue to rise, though the pace has moderated slightly.
• Jeonse prices are increasing faster than purchase prices, adding to market instability.
• The resumption of heavier capital gains taxes on multi-homeowners on May 9 has reduced listing volumes.
• New housing supply over the next three years is extremely limited, with fewer than 10,000 units per year.
• The local election on June 3 and potential tax law revisions in July are key near-term variables.
• Both Seoul mayoral candidates emphasize increasing housing supply, but differences are minor.
• High-end Gangnam prices may face pressure from possible reduction of long-term holding tax benefits.
• Real estate market remains buoyant, supported by strong stock market gains and high income in tech hubs.