Seoul's commercial and office real estate transactions fell by 31.2% in August compared to the previous month. The value of large transactions exceeding 100 billion won dropped by 48.0%, and transactions under 100 billion won also saw declines in both volume and value, leading to an overall contraction in the market. However, the cumulative transaction volume from January to August increased by 13.3% compared to the same period last year.
AlSquare, a comprehensive commercial real estate service company, reported on the 14th that its RA (AlSquare Analytics) analyzed data from the Ministry of Land, Infrastructure and Transport, revealing that the transaction volume for August was 1.8077 trillion won, with 139 transactions recorded.
Compared to the previous month, the transaction volume decreased by 31.2%, and the number of transactions fell by 24.5%. The average transaction amount also dropped to 13 billion won, an 8.9% decrease from the previous month.
Transaction Slowdown in August After Growth in First Half of the Year
In the first half of this year, the number and volume of commercial and office real estate transactions in Seoul increased by 21.8% and 13.8%, respectively, compared to the same period last year. Excluding large transactions over 100 billion won, the transaction volume also rose by 27.6%, indicating growth in both large and small transactions.
Monthly transaction volumes were recorded at 2.8115 trillion won in June and 2.6272 trillion won in July, marking two consecutive months above 2 trillion won, with large transactions accounting for more than half of the total volume in both months. However, in August, the number of transactions decreased from 184 in July to 139, and the transaction volume fell back to the 1 trillion won range.
The decline in transactions was also evident in those under 100 billion won, with the number of transactions down by 24.7% and the volume down by 9.0% compared to the previous month. The combined transaction volume for July and August also decreased by 14.1% year-on-year.
While the number of large transactions remained relatively stable, with five transactions over 100 billion won in August compared to six in July, the total transaction volume for these large deals plummeted by 48.0% to 776.9 billion won. This significant drop in the value of individual large transactions is believed to have pulled down the overall transaction volume.
The largest transaction in August was the 'Corner 136 Building' in Seogyo-dong, Mapo-gu, which sold for 252 billion won. This was followed by the 'E-Mart Cheonho' in Cheonho-dong, Gangdong-gu, at 166.6 billion won, and the 'Shinhan Exspace' in Chungmuro 2-ga, Jung-gu, at 128 billion won.
Cumulative Transaction Volume Reaches 15.8 Trillion Won Amid Financing Concerns
Despite the monthly decline compared to the previous month, the transaction volume in August maintained an upward trend compared to the same month last year, increasing by 77.0%, while the number of transactions rose by 6.9%.
The cumulative transaction volume from January to August reached 15.7771 trillion won, a 13.3% increase from the same period last year. The cumulative number of transactions also rose by 16.1% to 1,356.
However, future interest rates and financing conditions are seen as variables for the market. An official from AlSquare's research center stated, "There are concerns that rising interest rates may lead to financing pressures, which could further dampen future transactions and increase market uncertainty."
* This article has been translated by AI.
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