2025 Seoul Money Show: Supply Shortages Persist Despite Leadership Changes
- Seoul's real estate market is navigating a complex landscape of loan regulations, trade tensions, and fluctuating interest rates, according to experts at the 2025 Seoul Money Show.
- after a period of relative calm, Seoul's housing market saw prices rise in areas like Gangnam, Yeouido, Mapo, Yongsan, and Seongdong between May and June of last year.
- With presidential elections looming on June 3, market interest has shifted to future policies.
Seoul Real Estate Market Faces Uncertainty Amid Political Shifts
Seoul’s real estate market is navigating a complex landscape of loan regulations, trade tensions, and fluctuating interest rates, according to experts at the 2025 Seoul Money Show. The market’s direction remains uncertain as the nation approaches early presidential elections.
Market Freeze and Future Outlook
after a period of relative calm, Seoul’s housing market saw prices rise in areas like Gangnam, Yeouido, Mapo, Yongsan, and Seongdong between May and June of last year. however, government loan restrictions and regulations led to a market freeze, exacerbated by political uncertainty that began in December.
With presidential elections looming on June 3, market interest has shifted to future policies. Experts at the Seoul Money Show emphasized the difficulty in predicting market trends amid political and economic uncertainties. They offered strategies for potential homebuyers and real estate investors.
Expert Opinions on Market Revitalization
Several experts shared their insights at the event,including Kwon Young-sun from Shinhan Bank Real Estate Investment Advisory Center,Park Won-gap of KB Kookmin Bank,Kim Hak-ryul,director of the Smart Tube Real Estate Research Institute,and Park Hap-soo,a professor at Konkuk University. They participated in a session led by a Yonsei University professor.
the consensus among experts is that a fast revitalization of real estate transactions is unlikely.Tightened financial regulations and expanded land transaction permit areas in Seoul are expected to maintain the current market conditions in the short term. However,experts suggested that potential homebuyers could find opportunities in this habitat.
Choi Hwan-seok,director of a research center,stated that “the transaction does not increase when the market is uncertain.” Kwon Young-sun added that market uncertainty would persist until after the presidential election, when the new government’s policies and the impact of global economic factors become clearer.
Policy Shifts and Supply Concerns
The potential re-examination of the 2nd Lease Law and the possible abandonment of reconstruction projects are adding to the market’s complexity. The fate of the ‘Special Act on Promotion of Reconstruction and Redevelopment’ remains uncertain due to disagreements within the National Assembly.
Park Won-gap noted that “The Democratic Party’s real estate policy is unlikely to be concrete until the end of the presidential election,” raising concerns about a potential shift toward increased regulation if the government changes.
Supply Shortages and Past Trends
Despite current uncertainties, some anticipate upward pressure on house prices in the latter half of the year. Real estate R114 projects a decrease in Seoul’s housing supply,with an estimated 9,640 households in 2026 and 9,573 in 2027,a significant drop from this year’s projected 37,768 households.Professor Ko Jun-seok stated, “The fact that housing supply is short of the next two years is known.”
The market also draws parallels to past regime changes. Following former President Park Geun-hye’s impeachment, the metropolitan area saw a 0.36% increase in house prices in March 2017. This upward trend continued after the inauguration of former President Moon Jae-in, with rapid increases in May, June, and July of 2017.
Interest Rates as a Decisive Factor
Experts believe that interest rate trends will be a key factor in determining the market’s direction. A decrease in interest rates could positively influence buyer sentiment. Professor Park Hae-soo said, “Depending on what interest rates are, there is a possibility of the direction of the house price and also the amplitude.” However, Park Won-gap cautioned, “It is uncertain whether the market interest rates are already down, so it is uncertain whether it will be released.”
Strategic Investment advice
kim Hak-ryul advised focusing on the basic nature of real estate, reminding investors that “the more opaque the market is,” the more important it is to make informed decisions. He noted the difficulty for many to enter the Seoul market due to high prices.
Professor Park Hae-soo emphasized the importance of reconstruction and redevelopment for increasing housing supply in Seoul, stating that “The reconstruction of the Seoul Han River is worth it because it means buying land in a good location.”
While cautioning against premature investment in local real estate markets, experts highlighted the importance of focusing on core metropolitan areas.Kim Hak-ryul emphasized the importance of local government policies, while Kwon Young-sun noted the recent struggles of the local housing market.
experts advised keeping an eye on the pre-sale market, which is expected to resume in May after a period of stagnation due to political uncertainty.
Seoul Real Estate Market Faces Uncertainty: A Guide for Investors and Homebuyers
The Seoul real estate market is currently in a state of uncertainty, heavily influenced by:
- Loan regulations
- Trade tensions
- Fluctuating interest rates
- Upcoming presidential elections
Experts at the 2025 Seoul Money Show emphasized the complex landscape, making predictions challenging. this echoes a “market freeze” that set in after the initial price rises in areas like Gangnam last year, largely due to restrictions.
The main driver of uncertainty is the upcoming presidential election in June. Coupled with this are:
- government loan restrictions and regulations.
- Shifts in policies depending on the winning party.
- Broader global economic concerns.
Experts suggest a fast market revitalization is unlikely. Kwon Young-sun from Shinhan Bank Real Estate Investment Advisory Centre, and Park Won-gap of KB Kookmin Bank. believe that tightened financial regulations and expanded land transaction permit areas in Seoul are expected to maintain current market conditions.
The market is expected to stay stagnant in the short term.
Despite current uncertainties, some anticipate upward pressure on house prices in the latter half of the year. The following is a key factor:
- Supply Shortages: Real estate R114 projects a decrease in Seoul’s housing supply, with substantially fewer households expected in 2026 and 2027 compared to this year. Professor Ko Jun-seok highlights this as a important factor.
The market draws parallels to the past. Following the 2017 impeachment of former President Park Geun-hye, metropolitan area house prices increased by 0.36% in March 2017. This upward trend persisted after the inauguration of former President Moon Jae-in, with notable increases in the following months. This pattern is influencing how property is valued today.
Interest rates are considered a decisive factor.
- Decreasing interest rates can likely increase buyer sentiment.
- Professor Park Hae-soo: “Depending on what interest rates are, there is a possibility of the direction of the house price and also the amplitude.”
- However,Park Won-gap cautions that it is uncertain whether rates are actually coming down.
Here’s the key advice for investors:
- Focus on the fundamentals: Kim hak-ryul advises focusing on the basic nature of real estate, especially given the market’s opaqueness. The importance of making informed decisions increases in such a market.
- Reconstruction and Redevelopment: Professor Park Hae-soo emphasizes the importance of reconstruction/redevelopment projects. “The reconstruction of the Seoul Han River is worth it because it means buying land in a good location.”
- Core Metropolitan Areas: While cautioning against hasty investments, experts stress focusing on core metropolitan areas of Seoul.
- Keep an eye on the pre-sale market: The pre-sale market is expected to resume in May.
Concerns revolve around potential policy shifts after the presidential election:
- re-examination of the 2nd Lease Law.
- Potential abandonment of reconstruction projects.
- The fate of the ‘Special Act on Promotion of Reconstruction and Redevelopment’.
- Park Won-gap: “The democratic Party’s real estate policy is unlikely to be concrete until the end of the presidential election,”
While a fast revitalization is unlikely, Professor Choi Hwan-seok, director of a research center suggested that potential homebuyers could find opportunities in this habitat.
Kwon Young-sun from Shinhan Bank Real Estate Investment Advisory Center noted that understanding that market uncertainty will persist until after the presidential election can definitely help keep you informed.