Above and Beyond Gangnam

If you could invest in property anywhere in central Seoul, which district would you choose? In my case, if I had 십억 (a billion won) to invest, I wouldn’t go anywhere near Gangnam, but rather would head for the more surprising locales of Noksapyeong and other Itaewon-ish places, and, believe it or not, Yeongdeungpo.

Once the anti-Itaewon feeling departs, I reckon there’ll be new construction, and an influx of Korean residents who realise ‘oh my God, this place is right in the middle of Seoul, and it’s pretty cheap, too’.

When I say this to people from Seoul (Seoulites to the Metropolitan authority, Seoulists to us), they think I’m crazy. Gangnam, especially to a certain kind of person—ie. a snob, or a pushy, school-bothering mother—is the alpha and omega of property investment in this city. But that is exactly the reason why you shouldn’t buy there, even if you can afford it. It is massively overpriced, and has already gone through its boom years. It isn’t an especially beautiful place, and doesn’t really look any different to the rest of Seoul. What it does have going for it is good schools, which make education-obsessed parents want to live there.

Right now though, Korean people are not having kids. The average woman here will have just 1.15 in her lifetime. This is pretty much the lowest rate in the world, and way, way lower than it used to be. What’s more, do you think that over time there won’t be a policy of opening decent schools elsewhere? There is endless criticism of the fact that almost half of SKY (SNU, Koryo and Yonsei Universities—the “Ivy Leagues” of Korea) students come from Gangnam.

Noksapyeong, Bokwang-dong, and other areas around Itaewon, look much better to me. Itaewon, as everyone knows, is going upmarket. I was away from Korea from 2007 to 2010, and could not believe the lack of sleaze in that area behind the Hamilton Hotel upon my return. Quite what the world is coming to, I don’t know, but the place is now on a strong yuppifying trajectory. It is only a matter of time before the likes of Hong Seok-cheon cross the road and force Seoul Pub to remodel or die.

The US Army will be leaving Yongsan in the not-too-distant future as well, which will remove the ‘ooh, big scary foreigners’ stigma the whole area has. All these districts are right in the middle of Seoul—you can be anywhere in 15 minutes—and once the anti-Itaewon feeling departs, I reckon there’ll be new construction, and an influx of Korean residents who realise ‘oh my God, this place is right in the middle of Seoul, and it’s pretty cheap, too’.

In the meantime, you could buy a villa, divide it up, and rent rooms out to foreigners (dare I say, at inflated prices). Even though it sometimes seems like everyone in Korea hates English teachers, landlords don’t—because they always pay on time. Am I wrong?

Daniel Tudor

About Daniel Tudor

Daniel Tudor is the Korea correspondent for The Economist. His book, ‘Korea: The Impossible Country,’ will be published by Tuttle in spring 2011. He often uses obscure British expressions which you can look up here. Find out more at daniel-tudor.com

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