South Korea tops the list of the world’s most expensive housing, surpassing Dubai. The most expensive apartments are now located in Seoul and its prestigious Gangnam district.

ccording to Knight Frank’s Prime Global Cities Index, Seoul has taken the top spot for luxury housing, with a record 18.4% increase in prices over the past year. Also making the top four are Manila (17.9%), Dubai (16.9%), and Tokyo (12.7%). Kenya follows next, but the gap is significant — annual price growth in Nairobi was only 8.3%, which is still notable compared to the average increase of 3.2% across all cities in the index.

The rise in real estate prices in Seoul is driven by local market conditions: 

  • Limited construction. Seoul ranks among the 30 most densely populated cities in the world. While this alone is not critical, local authorities have imposed strict limitations on new developments, focusing instead on renovating existing housing stock. This policy has restricted supply and driven up property prices.
  • Education hubs. Some of South Korea’s most prestigious educational institutions are concentrated in Seoul’s Seocho-gu, Yongsan-gu, and Hannam-dong districts. To enroll in these schools, students or their parents often have to buy or rent expensive housing nearby, which further drives up demand and prices.
  • Eased mortgage regulations. In 2023, the South Korean government lowered down payment requirements (from 60% to 50%), increased loan limits (by 10% for young buyers and first-time homeowners), and extended the maximum mortgage term (from 30 years to 40 years).

The current market is far from stable, as Seoul’s real estate sector is increasingly vulnerable to housing bubbles. In the past, similar bubbles have led to overheated demand and subsequent market crashes.

Political instability further adds uncertainty — following the impeachment of the president after the declaration of martial law, investor confidence in the market has been shaken. We’ll keep an eye on how the rankings change over time.