Seoul apartment transactions dropped 36.6% to 3,466 in August from 5,465 in July, according to the Ministry of Land, Infrastructure and Transport's actual transaction price disclosure system on the 29th. August's total was less than half the more than 8,000 monthly deals recorded in April and May. September transactions stood at 1,387, although the figure can rise because deals must be reported within 30 days of signing. A recovery is nevertheless expected to be limited. Land transaction permit applications, an early indicator of sales activity, fell 65.1% to 3,547 in August from 10,165 in April, while September applications were 3,853 as of the previous day. Outer districts continued to record the largest volumes, led by Nowon-gu with 479 applications, followed by Gangseo-gu with 251, Eunpyeong-gu with 244, Dobong-gu with 237 and Guro-gu with 219. Applications across the three Gangnam districts fell 70.1% from April as lending restrictions and heavier taxes reduced activity. Prices have also softened in Gangnam: an 84-square-meter unit at Gaepo Xi Presidence in Gaepo-dong, Gangnam-gu, was cut from 4 billion won ($2.9 million) to 3.47 billion won before selling in early September. Brokers say cash buyers can secure distressed sales 500 million to 600 million won below market, while loan-dependent buyers face tight financing. The government’s extension of the grace period for owner-occupancy requirements on rented homes in land transaction permit zones through the end of next year could bring additional listings after taking effect next month, but a 100 million-won cap on loans for returning jeonse (lump-sum deposit lease) deposits is expected to limit its effect. Yang Ji-young, a specialist at Shinhan Premier Pathfinder, said demand is shifting toward outer Seoul because jeonse listings are scarce, but rising rates are preventing heavily leveraged buyers from following prices higher. Yang said Gangnam transactions were mainly distressed sales after the tax overhaul and could weaken again once that supply is exhausted.