An Apartment Cheaper Than a Chanel Bag? Korea’s Housing Polarization Hits Record High

Korea’s Housing Market Shows Record-Level Polarization

SEOUL — South Korea’s housing market is showing unprecedented polarization, with apartment prices ranging from levels lower than luxury handbags to tens of billions of won, according to official transaction data.

An apartment complex in Yakmok-myeon, Chilgok County, North Gyeongsang Province, recorded the lowest home sale price nationwide, government data showed.

According to the Ministry of Land, Infrastructure and Transport’s public transaction system, a 32-square-meter unit in Seongjae Apartment was sold on December 11 for 11 million won, the lowest recorded apartment transaction in the country.

By contrast, the most expensive home sold during the same period was a 152-square-meter unit at Shinhyundai Apartment Complex No. 8 in Apgujeong-dong, Gangnam District, Seoul, which changed hands for 85 billion won. At that price, buyers could theoretically purchase approximately 773 units of the Seongjae Apartment.

Apartment Prices Below Luxury Goods

The Seongjae Apartment’s transaction price is lower than that of some luxury fashion items. Chanel’s Classic Medium Flap Bag was sold in November and December last year for £8,970 (about 15.43 million won) in the UK and €11,100 (about 16.1 million won) in Europe.

Seoul’s Dominance Reaches All-Time High

Real estate analysts say the housing market divide has reached a historic extreme. According to the Bank of Korea’s Financial Stability Report, as of the end of November last year, the total market capitalization of apartments in Seoul accounted for 43.3% of the national total.

This figure exceeds the previous peak of 43.2% recorded in August 2020, during the height of the debt-driven homebuying surge, marking the highest level since records began.

Government Moves to Support Regional Housing Markets

In response to the widening gap, the government has introduced tax incentives aimed at revitalizing regional housing markets.

Buyers of unsold apartments in non-metropolitan areas are eligible for up to a 50% reduction in acquisition tax. In addition, the government has extended 100% acquisition tax exemptions for newlywed couples and young people purchasing their first home.

A government official said the measures are designed to support balanced national development, stabilize livelihoods, and improve the tax system, adding that authorities will work closely with local governments to ensure taxpayers fully understand and benefit from the incentives.