Nationwide Housing Prices Rise by 0.07%, Driven by Metropolitan Recovery

Nationwide Housing Prices Turn Upward, Driven by the Metropolitan Area

According to the weekly apartment price trends released by the Korea Real Estate Board for the third week of May 2026 (as of May 18), the nationwide apartment sales price index rose by 0.07% compared to the previous week. After a prolonged period of wait-and-see sentiment and a downward phase, the fact that nationwide housing prices have begun to draw a gradual upward curve again is drawing significant attention from market participants.

The core driver of this numerical rebound is clearly concentrated in Seoul and the metropolitan area. Non-metropolitan provincial markets are still under strong downward pressure due to concerns over accumulated unsold inventory and a lack of transactions. On the other hand, a preference for newly built apartments is becoming apparent around core residential locations in Seoul, such as the three Gangnam districts and the 'Ma-Yong-Seong' (Mapo, Yongsan, Seongdong) area. This, combined with the demand shifting from renting to buying due to continuously rising jeonse (deposit-based lease) prices, has strongly pushed up prices. As a result, the distinct strength of this metropolitan market more than offset the weakness in the provinces, turning the overall average of 'nationwide housing prices' positive.

Implications for Investors: Prepare for Deepening Polarization

It is unreasonable to interpret the current 0.07% rise as the complete end of the real estate bear market or a precursor to rapid price spikes like in the past. Asset market investors must carefully monitor the underlying instability factors within the market.

• Extreme Regional Polarization: The gap between the metropolitan area and non-metropolitan areas, as well as between core and peripheral locations within the metropolitan area, is widening more rapidly. It is necessary to thoroughly analyze the supply and demand imbalance of individual regions and complexes hidden behind the macroeconomic average of 'nationwide housing prices'.
• Risk of Delayed Interest Rate Cuts: From a macroeconomic perspective, there is a possibility that the central bank's timing for cutting the base interest rate may be delayed due to higher-than-expected inflation indicators. This is a potential risk factor that could increase the burden of mortgage interest and suppress recovering buyer sentiment again.
• Direction of Jeonse-to-Purchase Ratio and Gap Investment Demand: Whether the continuous rise in jeonse prices will narrow the gap between sales and jeonse prices and stimulate so-called 'gap investment' demand again is an important variable that will determine short-term price direction.

In conclusion, the upward turn in nationwide housing prices based on the Korea Real Estate Board is a clear and meaningful signal in that it has secured downward rigidity. However, rather than blind and aggressive buying, a conservative portfolio approach focused on blue-chip assets and thorough interest rate risk management are still required at this time.