SEOUL — Concerns that stringent real estate tax regulations would trigger a supply crunch and ignite a fresh rally in housing prices have become a stark reality. Less than a week after the expiration of the temporary suspension of heavy capital gains taxes for multi-homeowners, the growth rate of Seoul's apartment prices has doubled. The market, which had shown signs of stabilizing in recent months, is now witnessing record-breaking weekly gains across the metropolitan area.

Market Rebound Post-Exemption
According to the weekly apartment price trend report released by the Korea Real Estate Board on May 14, Seoul’s apartment prices rose by 0.28% in the second week of May (as of May 11). This marks a significant jump from the previous week's 0.15% increase.

The 0.13 percentage point surge is the highest weekly growth recorded in 15 weeks, since the final week of January (0.31%), when the government first announced its intention to end the tax exemption period for multi-homeowners on May 9.

Real estate analysts attribute this "volatility shock" to a sudden "lockdown" of listings. As the deadline for the tax break passed, multi-homeowners who had not sold their properties chose to pull their listings off the market rather than pay the prohibitive heavy tax rates. This contraction in supply, coupled with a "wait-and-see" approach from both buyers and sellers, has allowed asking prices (hogas) to skyrocket.

All 25 Districts Turn Green
In a symbolic shift, the Gangnam District—the last bastion of price decline in Seoul—turned upward with a 0.19% increase after 11 consecutive weeks of stagnation or decline. This marks the first time since the third week of February that all 25 autonomous districts in Seoul have recorded positive growth simultaneously.

The "Gangnam Trio" led the charge, with Seocho District rising 0.17% (up 0.13%p from last week) and Songpa District jumping 0.35% (up 0.18%p).

However, the most explosive growth was seen in mid-to-lower-tier districts. Seongbuk District saw its weekly growth rate double to 0.54% from 0.27%, while Seodaemun District recorded its highest weekly gain (0.45%) since March 2014. Notably, Seongbuk and Jongno Districts hit their highest weekly growth rates since the Korea Real Estate Board began compiling these statistics in May 2012.

Disappearing Listings and Skyrocketing Ask Prices
Data from the real estate platform 'Asil' reveals that the number of apartment listings in Seoul dropped by approximately 6.5% in just five days, falling from 68,495 on May 9 to 64,067 on May 14.

"The 'fire sale' period for multi-homeowners has ended," said Nam Hyuk-woo, a researcher at Woori Bank's Real Estate Research Institute. "The market is now reflecting the scarcity of supply. Buyers who were waiting for even lower prices are now panicking as they see listings disappear and asking prices return to all-time highs."

The price movement at the individual complex level is even more dramatic. In Seongdong District, a 59.78㎡ unit at 'e-Pyunhansang Oksu Park Hills' recently traded at 2.23 billion won. Today, following the tax deadline, the asking price has been adjusted to 2.43 billion won, matching its previous record high. Similarly, in Gwangjin District, units at 'The Sharp Star City' that sold for 2.3 billion won in March are now listed at 2.4 to 2.5 billion won.

Expert Outlook: Prolonged Stagnation and "Revenge Pricing"
Experts warn that this trend of rising prices and falling transaction volumes (the so-called "transaction cliff") is likely to persist until a more definitive tax reform package is introduced.

"The deadline for the heavy capital gains tax was clear, but the government's plans for tax relief for non-resident single-homeowners remain vague," explained Shin Bo-yeon, a professor at Sejong University's Department of AI Real Estate Convergence. "Without a clear incentive to sell, homeowners feel no urgency to offload their assets at lower prices."

Professor Shin added that areas that experienced price corrections earlier this year might see a "compensation sentiment" or "revenge pricing," where sellers aggressively hike prices to make up for previous losses. "Until the new tax framework is finalized, the market will likely remain in a state of high-priced gridlock, fueled by scarcity and anxiety," she concluded.

As supply remains locked and demand remains unmet, the Seoul housing market faces a volatile summer, with the burden of taxation paradoxically pushing the dream of homeownership further away for many.