Union price 55 million KRW per 3.3㎡ but
HUG demands 49 million KRW for general sale
Reduce general sale by 121 units
to ensure profits go to union members
[Asia Economy Reporter Donghyun Choi] The 'Raemian One Bailey (Sinbanpo 3rdㆍGyeongnam Apartment Reconstruction)' in Banpo-dong, Seocho-gu, Seoul, which failed last year in its attempt to sell all general sale units at once, is reducing the originally planned general sale units from 346 households to 225 households. The association, concerned that the general sale price would be set below expectations, allocated units in a way that benefits the association members even if costs increase.
According to the maintenance industry on the 9th, the One Bailey reconstruction association recently held an internal meeting and tentatively finalized the allocation of units for association members, general sales, rental units, and reserved lots. Out of the total 2,990 units to be built, 2,588 units are for association members, 255 units for general sale, 148 units for rental, and 29 units for reserved lots. The association plans to submit this agenda for approval at the delegates' meeting scheduled for the 10th.
Notably, the general sale units, originally planned at 346 households, have been reduced by 121 households. This was somewhat anticipated when the association accepted requests for changes in association members' unit sizes around mid-last month. Initially, the association allowed commercial association members from Gyeongnam Shopping Center and Woojeong Esher to apply for apartment sales. Additionally, the 1+1 application target was expanded for existing apartment association members. This plan change was to respond to the low sale price set by the Housing and Urban Guarantee Corporation (HUG). The intention is to return profits to association members rather than giving general buyers speculative gains.
In fact, HUG requested the association in January to set the sale price at 49 million KRW per 3.3㎡, which is lower than the association members' sale price of 55 million KRW per 3.3㎡. The sale price of Banpo Woosung Apartment in Seocho-gu, near One Bailey, sold last October, was 48.91 million KRW per 3.3㎡, and the general sale prices of Seocho Grand Xi and Bangbae Grand Xi, sold earlier, were also set in the high 40 million KRW range. One association member of One Bailey said, "I have never heard of a case where the general sale price is set lower than the association members' sale price," adding, "The adjacent complex (Acro River Park) exceeded 100 million KRW per pyeong, so if the sale price here comes out at less than half that, it will cause a strong sense of deprivation."
The reserved lots, which the association can set the sale price for, were also increased to the maximum level within the legal limit. Reserved lots are units kept by the association as extras to prepare for errors such as association member unit losses during reconstruction or redevelopment projects or lawsuits during the sale process. The association can set reserved lots up to 1% of the total number of units. Generally, the association sells reserved lots through public bidding starting about six months before completion.
However, rental units increased by 9 units from the previous 139 units. This is interpreted as a measure to avoid difficulties in obtaining sale approval before the end of April, when the exemption for the private land sale price ceiling system expires, if rental units were also reduced. One Bailey, which passed structural review on the 5th, aims to hold a general meeting for approval of changes to the management disposition early next month and to accept sale applications on the 15th of the same month.
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