The number of leases in Seoul charging 1 million won or more a month for officetels — studio units used as either a home or an office — smaller than 30 square meters has jumped 70% in two years. That is nearly five times the growth rate for monthly-rent contracts overall. The share of relatively cheaper leases priced below 700,000 won, by contrast, is shrinking fast. High rents are spreading beyond the affluent Gangnam area to neighborhoods near universities and major business districts, narrowing the range of housing young adults can afford.
An analysis by The Seoul Economic Daily of officetel lease transactions in Seoul, drawn from the Ministry of Land, Infrastructure and Transport's actual transaction price disclosure system, found 4,737 contracts with monthly rent of 1 million won or more for units of 30 square meters or less between January and September this year. That is up 70.2% from 2,784 in the same period of 2024. Total monthly-rent contracts over the period rose just 14.5%, to 33,376 from 29,160. Measured against that pace, pricey leases grew about five times faster.
The higher the rent, the steeper the increase. Contracts at 1.5 million won or more a month rose to 528 this year from 188 in 2024, a 2.8-fold increase. Those at 2 million won or more climbed 4.5-fold, to 104 from 23. Leases of 1 million won or more accounted for 14.2% of all contracts, up 4.6 percentage points from 9.5%. Cheaper leases, meanwhile, are losing ground. The share of contracts below 700,000 won narrowed 7.5 percentage points over the same period, to 54.1% from 61.5%. The median monthly rent rose 8.3%, to 650,000 won from 600,000 won.
The trend is not confined to Gangnam, where expensive housing is concentrated. Pricey leases are also rising quickly in areas with heavy demand from university students and office workers. In Mapo District, contracts at 1 million won or more a month rose 72.3%, to 243 this year from 141 in 2024. Total monthly-rent contracts there were virtually unchanged over the same period, at 2,320 against 2,319. Contracts below 700,000 won fell 25.5%, to 936 from 1,257. In Jongno District, the share of leases at 1 million won or more leapt 15.9 percentage points, to 26.6% from 10.7%. Seodaemun District rose to 22.6% from 15.4%, and Gwangjin District to 19.9% from 13.5%. In Seongbuk District, the share of contracts below 700,000 won fell 23.9 percentage points, to 52.1% from 76.0%.
Ultra-small units of less than 20 square meters are also changing hands at around 1.5 million won a month. A 17-square-meter unit in Greenwood in Daehyeon-dong, near Ewha Womans University, was leased in August this year on a new contract with a 5 million won deposit and monthly rent of 1.35 million won. A 17-square-meter unit in Star Palace in Changcheon-dong, Seodaemun District, was leased in February with a 10 million won deposit and 1.5 million won in monthly rent. An 18-square-meter unit in Square Riverview Hapjeong in Hapjeong-dong, Mapo District, was leased the same month with a 10 million won deposit and 1.55 million won a month.
Maintenance fees are climbing along with rents. Average maintenance fees for studio apartments near 10 major universities in Seoul stood at 84,000 won in July this year, up 10.9% from 75,000 won a year earlier, according to a survey by the real estate information platform Dabang. Near Ewha Womans University, the average reached 103,000 won. Adding maintenance fees and utility bills to rent pushes actual housing costs higher still.
The burden stands out more when set against young adults' incomes. Employed young adults earn an average of 2.66 million won a month before taxes, according to the Office for Government Policy Coordination's 2024 survey on the lives of young adults. On that income, rent of 1 million won would absorb 37.6% of monthly pay, and 1.5 million won would take 56.4%. Young adults who want to live close to work or school may have to shoulder the higher cost or look to outlying areas with longer commutes.
The Seoul city government, taking account of young adults' housing costs, raised the monthly rent ceiling for eligibility under its interest subsidy program for young tenants' lease deposits in November last year, to 900,000 won from 700,000 won. Still, with pricey leases rising quickly and cheaper units making up a shrinking share of the market, some argue that financial and cash support alone has limits. Lee Soo-ki, a professor of urban engineering at Hanyang University, wrote in research published in June this year that high rents and a shortage of housing in major business districts can push young adults into commuting from the outskirts, and recommended expanding housing near jobs by supplying small-scale public rental units and remodeled housing for young adults in central areas.