[Beginner's Guide] Not Just 'Points' but 'Total Payment'?… Magok Public Sale, You Need to Know the 'Lotto' Too to Get It Right

[Asia Economy Reporter Lee Chun-hee] When you become a real estate reporter, you often get unexpected KakaoTalk messages from friends. "How do I apply for a housing subscription?" "What does first priority mean?" For the 2030 'Burin-i (real estate + beginner)' who only have subscription accounts their parents opened when they were young, I am trying to create a guide.

A complex considered a 'lottery sale' is coming again. It is Magok District 9 in Gangseo-gu, Seoul. After a special sale on the 9th and 10th, a general sale is scheduled from the 16th to the 18th. The sale prices (highest prices) for Magok District 9 are 525.15 million KRW for 59㎡ (exclusive area, 433 units) and 697.5 million KRW for 84㎡ (529 units). Considering that last month, nearby Magok M Valley District 8's 59㎡ units traded at 950 million KRW and 84㎡ units at 1.083 billion KRW, this is considered a 'lottery' at about half the price of the nearby market.

Similarly, the 'Jade Zai' in S9 Block of the Knowledge Information Town in Gwacheon, Gyeonggi Province, which was a 'private participation' public sale, recently attracted 25,560 applicants for first priority subscription. With a supply of 132 units, the average competition rate was 193.6 to 1. The sale price for the 59㎡ units was between 523.2 million and 542.3 million KRW for the standard floor. Considering that nearby Wonmun-dong's 'Raemian Sure' 60㎡ units traded at 1.227 billion KRW last month and that Gwacheon's housing prices are in the high 40 million KRW per 3.3㎡ range, this is also considered a 'lottery' at about half the price.

However, even lotteries have become something you need to study to win. The Magok District 9 sale is a 'public sale,' so it is conducted differently from existing sales.

Currently, private sales in Seoul supply all small and medium-sized units of 85㎡ (exclusive area) or less through a point system that ranks applicants by combining points for the period of being homeless, number of dependents, and subscription account membership duration.

For example, in the 'Le El Shinbanpo Central' sale last November, the lowest winning score was 69 points across all unit types. Considering that the maximum points achievable by 'period' in the current point system are 49 points (32 points for over 15 years of being homeless and 17 points for over 15 years of subscription account membership), 69 points was a score only possible for a household head over 45 years old, especially one with a family of four. Now, it is a world where you need to have been homeless for a long time and have at least two children to aim for subscription.

However, Magok District 9 determines winners in the general supply not by points but by the 'total amount of savings deposits.' To qualify as a first priority general supply applicant, you must have been a member of the resident savings account for over two years and have paid monthly installments at least 24 times on the agreed payment dates as the head of the household. None of the household members should have won a subscription within the last five years.

Up to this point, it is not much different from the point system. But while private sales rank first priority applicants again by points, public sales assign ranks among those who have been homeless for over three years based on the amount of savings deposits. However, it is crucial to remember that only 100,000 KRW per month is recognized for the total amount.

Since there is a minimum amount requirement, such as having 15 million KRW in the account to apply for all unit sizes in Seoul, some people might have deposited this amount all at once. Others might have paid 200,000 KRW monthly to maximize income tax deductions at year-end. However, any amount exceeding 100,000 KRW per installment is not recognized.

For example, Mr. A, who deposited 100 installments of 100,000 KRW monthly and separately deposited 10 million KRW to reach 15 million KRW, will have only 5 million KRW recognized. Mr. B, who deposited 200,000 KRW monthly for 30 installments to make 6 million KRW, will have only 3 million KRW recognized.

Unless you have been depositing exactly 100,000 KRW monthly, you must remember that the total amount in your subscription account is not all recognized for payment credit to properly strategize your subscription. You can check the actual recognized amount by viewing the detailed information of your subscription account through internet or mobile banking.

Aerial view of Magok 9 Complex, Gangseo-gu, Seoul (Provided by SH Corporation)

Unlike private sales, public sales have income and asset criteria. Magok District 9 does not apply income criteria for general supply but does apply it for special supply. For the first-time homebuyer special supply, the previous year's average monthly income of urban workers per household must be 100% or less. For households of three or fewer, this is 5,554,983 KRW per month.

In the case of Jade Zai, asset criteria were also added. The total real estate assets owned by the household must be 215.5 million KRW or less based on official prices, and the value of automobiles must not exceed 27.64 million KRW.

Usually, private sales have more general supply units than special supply units, but public sales have a much higher proportion of special supply units. Jade Zai has 515 units (79.6%) out of 647 as special supply, and Magok District 9 has 710 units (73.8%) out of 962 as special supply. Since it is possible to apply for both special and general supply simultaneously, carefully checking whether you qualify for special supply is also a way to increase your chances of winning. Don't forget!