Authored by the expert who managed and guided the team behind the South Korea Property Pack
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What will happen in Seoul’s real estate market? Will prices go up or down? Is Gangnam still a hotspot for foreign investors? How is South Korea’s government impacting real estate policies and taxes in 2025?
We’re constantly asked these questions because we’re deeply involved in this market. Through our work with real estate agents, developers, and clients who buy properties in Seoul, we’ve gained firsthand insights.
That’s why we created this article: to provide clear answers, insightful analysis, and a well-rounded perspective on market predictions and forecasts.
Our goal is simple: to ensure you feel informed and confident about the market without needing to look elsewhere. If you think we missed the mark or could do better, we’d love to hear your thoughts. Feel free to message us with your feedback or comments, and we’ll work hard to improve this content for you.
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1) More foreign investors will enter Seoul’s real estate market as South Korea enhances its global economic connections
Foreign investment in South Korea's real estate market is on the rise, with 23,000 apartment units purchased by foreigners from 2017 to May 2024, totaling around 6.4 billion USD.
South Korea is actively working to boost its global economic connections, which is a big draw for international buyers. A standout example is the Korea-Philippines Free Trade Agreement signed in 2023. This deal cuts down customs duties on many goods, making South Korea a more appealing spot for foreign investors.
Economic indicators in South Korea are looking good, too. By September 2024, Foreign Direct Investment (FDI) made up 1.2% of the country's Nominal GDP, a jump from 0.6% the previous quarter. This healthy economic climate is likely to attract more foreign investors to Seoul's real estate scene.
There's also a global trend of shifting real estate investments towards Asian markets, including South Korea. This shift is largely due to the region's economic growth and stability, making it a hot spot for international investors.
Seoul, in particular, is becoming a magnet for foreign buyers. The city's vibrant culture, advanced infrastructure, and strategic location in Asia make it a prime choice for those looking to invest in real estate.
As South Korea continues to strengthen its economic ties worldwide, the number of foreign investors in Seoul's real estate market is expected to grow. This trend is supported by the country's proactive trade agreements and favorable economic conditions.
Sources: IEA, CEIC Data, Global Property Guide
2) Short-term rental demand will grow, increasing yields in tourist-friendly areas
The demand for short-term rental properties is set to rise, especially in tourist-friendly neighborhoods.
Seoul is buzzing with tourists, as 7.7 million foreign visitors arrived in the first half of 2024, a whopping 74% jump from the previous year. This influx means more people are looking for places to stay, and short-term rentals are a hot choice. With the city’s vibrant culture and attractions, it's no wonder tourists are flocking here.
Short-term rental platforms are becoming increasingly popular. The market is booming, with projections showing it could hit $120.77 billion in 2024 and soar to $169.75 billion by 2028. This surge is fueled by more people traveling and the flexibility of remote work, which lets them stay longer and explore more.
In Seoul’s tourist hotspots, short-term rentals are in high demand. A typical listing is booked for 296 nights a year, boasting a median occupancy rate of 81%. This high occupancy shows just how much tourists love these convenient and often unique accommodations.
For those considering investing in property, these trends highlight a lucrative opportunity. With the rise in tourism and the popularity of short-term rentals, yields in these neighborhoods are likely to increase. It’s a chance to tap into a thriving market and benefit from the city’s growing appeal.
Sources: Skift, GlobeNewswire, Airbtics
We did some research and made this infographic to help you quickly compare rental yields of the major cities in South Korea versus those in neighboring countries. It provides a clear view of how this country positions itself as a real estate investment destination, which might interest you if you’re planning to invest there.
3) Average property prices will drop slightly in some areas due to affordable housing projects
In 2023 and 2024, the Seoul city government invested 6.7 trillion won to boost affordable housing.
Historically, when new affordable housing pops up, property prices tend to stabilize. Take the "third new town" program, for instance. It's set to bring 236,000 housing units by 2029, aiming to keep prices steady in places like Wangsook and Gyosan.
Experts are saying that with more affordable homes, average property prices might dip a bit. This isn't just a hunch; economic forecasts back it up, showing a link between affordable housing and market trends.
In areas where these projects are underway, property prices have shown signs of adjusting. It's a pattern seen before, where increased supply can nudge prices down.
For potential buyers, this could mean more opportunities to snag a home at a reasonable price. The market's shift is something to watch, especially if you're eyeing a property in these regions.
Sources: Korea JoongAng Daily, MK Real Estate, Korea Times
4) Property prices in Seoul's northern districts will rise unexpectedly due to better infrastructure and accessibility
Seoul's northern districts are becoming more appealing due to major infrastructure upgrades.
The city is pouring resources into transportation projects that will make these areas easier to reach. New subway lines and extensions are in the works, and by 2025, the KTX high-speed train and GTX train stations will be operational, boosting connectivity significantly.
These developments are already sparking interest in the property market. In places like Guri, there's a noticeable uptick in property transactions as more Seoul residents are choosing to move there, drawn by the promise of better access and new housing options.
Media outlets are buzzing about the transformation of northern Seoul, painting it as a prime spot for living and working. This kind of attention is likely to draw even more buyers and investors, eager to capitalize on the area's growing potential.
With these changes, the northern districts are set to become a hotbed for real estate activity, offering a fresh alternative to the more crowded parts of the city.
Sources: Korea Times, Highways Today, Korea.net
5) Demand for rentals near universities will rise as more international students arrive
Seoul is seeing a surge in international students, with numbers climbing past 200,000 in 2023.
Thanks to initiatives like the Study Korea 300K plan, the South Korean government is actively attracting more international students. This influx is particularly noticeable in the greater Seoul area, where many students are enrolling in universities.
With more students comes a higher demand for housing, especially near universities. Students often prefer living close to campus for convenience, but on-campus housing is limited, pushing them to look for off-campus rentals.
This increased demand has led to a shortage of student accommodation, which in turn is driving up rental prices near universities. Real estate market reports are highlighting this trend, showing a clear rise in interest from international students.
As a result, rental prices in these areas are climbing, making it a competitive market for student housing. This trend is creating opportunities for property investors looking to tap into the student rental market.
For those considering buying property in Seoul, the growing student population is a key factor to consider, especially if you're looking at areas near universities.
Sources: The PIE News, Korea JoongAng Daily, University World News
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6) Property values near the Han River will rise significantly due to new riverfront development projects
Neighborhoods near the Han River are on the brink of a property value boom thanks to exciting new riverfront projects.
In the past, projects like the Hangang Renaissance turned places like Yeouido and Jamsil into hot spots, boosting property values significantly. Now, with the Great Hangang project, the Seoul Metropolitan Government is planning to revitalize the riverfront with 55 ambitious tasks, including marinas and gondola cable cars.
These developments aim to make the Han River area a magnet for both locals and tourists, enhancing its appeal and driving up property values. The plan also includes renovating residential areas to create stunning skylines, adding to the area's charm.
Transportation is getting a major upgrade too. The subway network is expanding, and gondola cable cars are on the way, making the Han River neighborhoods more accessible and desirable. This improved connectivity is a game-changer for property values.
Living near the river is already attractive, but with these enhancements, it's set to become even more appealing. The combination of better transport and riverfront living is a recipe for rising property values.
Sources: Korea Times, Korea JoongAng Daily
7) Demand for properties with shared amenities will grow in Seoul as residents seek community-oriented living spaces
Seoul's co-living market is booming, with 6,200 units as of May 2023, marking a 20.5% growth since 2014.
As more people live alone, with single-person households jumping from 1.12 million to 1.49 million between 2015 and 2021, there's a shift towards smaller, shared living spaces.
New residential complexes in Seoul are designed with shared amenities to foster community connections. Take Collective Mine, an all-female residence with shared bathrooms and a communal cafe, which encourages social interactions and neighborhood engagement.
Surveys from 2023 reveal that older generations, especially those in their sixties, often visit community centers, showing a preference for community-oriented living that spans across age groups.
Real estate reports highlight that co-living properties are in high demand, particularly among young professionals and students who value social connections.
The media has been emphasizing the benefits of communal living, such as improved social connections and reduced isolation, further driving demand for such properties.
Sources: Savills Asia, Asia News Network, Highways Today, Statista
8) Songpa will draw more families because of its top-notch schools
Songpa district is quickly becoming a top choice for families because of its excellent educational facilities.
In recent years, particularly in 2023 and 2024, Songpa schools have consistently ranked high in national education assessments. This impressive performance is a major draw for families looking to provide their children with quality education.
Enrollment numbers are also telling a story. Songpa saw the highest number of 6-year-olds entering elementary schools in Seoul, with 4,748 students, outpacing even Gangnam, which had 3,747. This shows a clear preference among families for Songpa's educational offerings.
The government is also playing a role by investing in educational infrastructure in Songpa. While specific details are scarce, the district's status as the largest autonomous area in Seoul with a dense population suggests a strong potential for educational growth and development.
These investments are likely improving the quality and availability of educational facilities, making Songpa even more attractive to families. The district's focus on education is evident and continues to draw attention.
With these factors in play, it's no wonder that Songpa is becoming a preferred destination for families prioritizing education for their children.
Sources: MK, Korea Times, OECD Education
We have made this infographic to give you a quick and clear snapshot of the property market in South Korea. It highlights key facts like rental prices, yields, and property costs both in city centers and outside, so you can easily compare opportunities. We’ve done some research and also included useful insights about the country’s economy, like GDP, population, and interest rates, to help you understand the bigger picture.
9) Demand for eco-friendly homes in Seoul will rise as residents become more environmentally conscious
In Seoul, eco-friendly homes are gaining traction as residents become more environmentally conscious.
By 2025, the city aims for all new buildings to meet Zero Energy Building (ZEB) standards, with a push for green remodeling in commercial spaces. This initiative is part of a broader effort to make 800,000 buildings more energy-efficient by 2024. The city is actively promoting these changes, reflecting a significant shift in urban planning.
Seoul's residents are increasingly opting for sustainable building materials, driven by a growing awareness of environmental sustainability. This trend is supported by government incentives, including financial aid for ZEB certification and tax breaks, which make green building practices more appealing to developers.
Media outlets are playing a crucial role by highlighting the benefits of eco-friendly homes, such as reduced energy consumption and better air quality. This media influence, along with stricter environmental regulations, is making green living more popular among Seoul's citizens.
The Korean government is committed to reducing greenhouse gas emissions and achieving carbon neutrality by 2050, which aligns with the increasing demand for eco-friendly homes. This commitment is a driving force behind the growing popularity of sustainable living options in the city.
Sources: Savills Asia, The Madrona Group
10) Demand for senior-friendly housing in Seoul will grow as the population ages
Seoul is seeing a big rise in its elderly population.
By 2024, nearly 20% of South Korea's population was aged 65 and older, and this number is expected to grow even more in 2025. This trend is pushing South Korea towards becoming a "super-aged society," with predictions that over 40% of the population will be elderly by 2050.
In 2023, there were 5.66 million households led by seniors, making up 26.5% of all households in the country. This figure is expected to rise dramatically, with projections showing that over half of all households will be led by seniors by 2052. This shift underscores the increasing demand for housing that meets the specific needs of older adults.
The Seoul Metropolitan Government is responding to this trend by planning to offer more affordable housing for those aged 65 and older. These homes will be conveniently located near subway stations and medical facilities, ensuring that seniors have easy access to essential services. The housing will also feature smart devices and emergency rescue alerts, designed specifically for senior safety and convenience.
These initiatives reflect a broader understanding of the needs of an aging population, as the city prepares for a future where senior-friendly housing becomes a necessity. The focus is on creating living spaces that not only provide comfort but also enhance the quality of life for older residents.
Sources: Korea Times, Korea JoongAng Daily, Yonhap News Agency
11) Seoul's property prices will stabilize as government policies target speculative buying
Seoul's real estate market is seeing stabilization in price growth thanks to government efforts to curb speculation.
One key move has been lowering the loan-to-value (LTV) ratio in speculative areas, meaning buyers can't borrow as much to purchase pricey homes. This makes it tougher for speculators to buy properties just to flip them for profit.
We've seen this approach work before. Back in 2012 and 2013, similar government interventions led to a decline in house prices in Seoul. By 2014 and 2015, prices had stabilized, proving these measures can have a lasting impact.
The Financial Service Commission is also playing a role by enforcing rules that require homeowners in speculative areas to sell their current home within two years if they want to buy another. This discourages quick flips and helps maintain market stability.
On top of that, the government plans to build 236,000 new homes by 2029. More homes mean less competition, which can help keep prices from soaring. They're also easing restrictions in certain areas to allow for more development.
These combined efforts are designed to create a more balanced market, making it less attractive for speculators and more stable for potential buyers.
Sources: Global Property Guide, Korea Times
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12) Interest in hanok-style homes will grow as buyers look for unique and culturally significant properties
Traditional hanok-style homes are becoming increasingly popular among homebuyers.
In Seoul, the area of hanok districts has doubled over the past decade, thanks to the Hanok Conservation and Regeneration Project. This initiative shows a strong commitment to preserving these unique homes, making them more attractive to those who appreciate cultural heritage.
Government incentives like "Hanok Registration" offer financial support for repairs, which makes investing in hanok properties more appealing. This not only helps maintain the architectural integrity of hanok homes but also boosts their value in the real estate market.
Young people are increasingly interested in cultural heritage, and programs like the Hanok Stay Programme are raising awareness. Social media influencers are also showcasing hanok-style living, which is sparking curiosity and appreciation among a wider audience.
In areas like Bukchon, hanok property values are rising due to growing interest and limited supply. These homes are seen as a desirable investment, especially as they align with modern sustainability goals.
Hanok-style homes are also part of the conversation about sustainable living, adding to their appeal. Their traditional design naturally supports eco-friendly living, which resonates with today's buyers.
Sources: ICOMOS Open Archive, Asian Art Newspaper, Korea Bizwire
13) Demand for properties in Seoul's outskirts will grow as remote work becomes more common
Remote work has become a major part of life in South Korea over the past few years.
Back in 2015, only about 66,000 people worked remotely, but by 2021, that number had skyrocketed to 1.1 million. This shift has made remote work technologies and flexible schedules more common, with hybrid work models leading the way.
As more people work from home, there's a noticeable trend: families are looking for larger living spaces. Suburban areas near Seoul are becoming popular because they offer green spaces and good schools, making them ideal for families seeking a better quality of life.
One of the big draws of these suburban areas is that property prices are generally lower than in central Seoul. This affordability is a key factor for buyers who want more space without breaking the bank.
Transportation is also getting a boost with large infrastructure projects like the subway network expansion. These improvements are making it easier to commute from the suburbs to the city center, which is likely to increase property values in these areas.
With remote work trends continuing to rise, properties in the outskirts of Seoul are expected to gain popularity. The combination of affordable housing, better transportation, and a family-friendly environment makes these areas attractive to potential buyers.
Sources: Pumble, Global Property Guide, CXC Global
14) Young professionals will drive up demand for co-living spaces as they look for affordable and flexible housing options
The demand for co-living spaces is booming among young professionals.
In bustling cities like Seoul, rising property prices have made traditional housing options a stretch for many. Since 2012, the cost of housing has been climbing, pushing young people to seek alternatives. Co-living spaces offer a solution, providing affordable and flexible living arrangements that cater to their needs.
Seoul has seen a significant increase in single-person households, with many of these being young professionals aged 18 to 39. This demographic shift highlights a growing need for adaptable living solutions. Monthly rentals are becoming more popular than the traditional Jeonse system, offering more flexibility and less financial strain.
Millennials and Gen Z are driving this trend, valuing flexibility and community engagement. Co-living spaces are designed to meet these preferences, offering communal living arrangements that emphasize shared experiences and a sense of community. This aligns with the broader shift towards minimalism and shared economies, making co-living an attractive option for those seeking a more flexible lifestyle.
These spaces are not just about affordability; they are about creating a lifestyle that resonates with younger generations. The emphasis on community and shared experiences is a big draw, as it provides a sense of belonging and connection in a fast-paced urban environment.
As the cost of living continues to rise, the appeal of co-living spaces is expected to grow. Young professionals are increasingly looking for living arrangements that offer both financial relief and a sense of community, making co-living a compelling choice.
Sources: Korea Co-living - Savills, South Korean Shared Housing Market Attracts Global Investors, Top 16 Coliving Trends for 2025 by Artof.co
We made this infographic to show you how property prices in South Korea compare to other big cities across the region. It breaks down the average price per square meter in city centers, so you can see how cities stack up. It’s an easy way to spot where you might get the best value for your money. We hope you like it.
15) Luxury real estate prices in the city will drop moderately as investors turn to mid-range properties
The luxury real estate market in Seoul is seeing a shift as more investors turn to mid-range properties.
One big reason for this change is the rising interest rates. The Bank of Korea bumped up its benchmark rate to 3.25% in November 2022, marking the ninth hike in a row. This makes luxury homes pricier and less appealing to buyers.
On top of that, the government has tightened the screws with stricter regulations and taxes on high-end real estate. The Financial Services Commission has made it tougher to get jeonse loans, and banks are being more cautious with lending. Plus, acquisition taxes for luxury homes can hit 12%, scaring off potential buyers.
There's also a noticeable shift in what buyers want, especially younger ones. With remote work becoming the norm, many are looking for bigger homes in less expensive areas. This has sparked interest in mid-range properties, which offer better value and returns.
Economic uncertainties are adding to the mix. According to CBRE's 2023 Korea Real Estate Market Outlook, there's a predicted drop in transaction volume and a rise in yields in commercial real estate. This is due to high interest rates and increased financing costs, which could slow down growth in luxury sectors.
Sources: Mordor Intelligence, PwC Tax Summaries, CBRE Korea
16) Yongsan will attract luxury home investments because of its central location and redevelopment plans
Yongsan district is turning into a prime spot for luxury residential investments.
One reason is that Yongsan's property prices have stayed stable and attractive, even when other parts of South Korea faced market challenges. This makes it a safe choice for luxury investors who want competitive prices in upscale areas.
Another big draw is the massive investment in infrastructure and public transport. The Seoul Metropolitan Government is transforming Yongsan into a major transportation hub and international business district. This includes developing a large area near Yongsan Station into the "Asian Silicon Valley," which will significantly boost the area's connectivity and appeal.
Moreover, the government has announced ambitious redevelopment projects, like turning an old train depot into a business district with a 100-floor skyscraper. These plans show a strong commitment to revitalizing Yongsan, making it an attractive option for luxury residential investments.
Yongsan's central location is another advantage. It's right in the heart of Seoul, offering easy access to the city's amenities and attractions. This centrality, combined with the ongoing developments, makes Yongsan a hotspot for those looking to invest in luxury properties.
With all these factors in play, Yongsan is poised to become a key player in the luxury real estate market. Investors are taking note, and the district's transformation is well underway.
Sources: InvestAsian, Korea Herald, Atlas of Urban Tech, Strait Times
17) Real estate demand and prices will surge around new GTX lines
New transportation projects often boost nearby property prices.
Take Seoul's Subway Line 5 as an example: when it opened, single-family home prices jumped by 17% and condo prices soared by 46% in just three years. This isn't just a Seoul phenomenon; in Tianjin, homes near new subway stations saw a 32.1% price increase. Now, with the GTX (Great Train Express) lines on the horizon, we're expecting a similar trend.
The Korean government is banking on the GTX to ease Seoul's notorious traffic jams. Imagine cutting your commute from Suwon to Samseong Subway Station from 78 minutes to just 22. This kind of time-saving makes living near GTX lines incredibly appealing.
Real estate agents are already seeing a buzz around future GTX stations. In Haengdang-dong, near Wangsimni Station, there's a palpable excitement about potential property value hikes. The media is also abuzz, predicting that real estate prices could skyrocket around GTX terminals as the new high-speed train slashes Seoul-Gyeonggi travel times.
Sources: Wiley Online Library, The Korea Times, Korea JoongAng Daily
While this article provides thoughtful analysis and insights based on credible and carefully selected sources, it is not, and should never be considered, financial advice. We put significant effort into researching, aggregating, and analyzing data to present you with an informed perspective. However, every analysis reflects subjective choices, such as the selection of sources and methodologies, and no single piece can encompass the full complexity of the market. Always conduct your own research, seek professional advice, and make decisions based on your own judgment. Any financial risks or losses remain your responsibility.