[Apartment Official Price Announcement] Seocho-dong Traumhaus 5th, Ranked No.1 in Joint Housing Official Price for 15 Years

Seocho-dong 'Traumhaus 5th' Exclusive 273㎡, Official Price 6.992 Billion KRW Ranks 1st Nationwide
Hannam-dong 'Hannam The Hill' 245㎡, 6.568 Billion KRW Ranks 2nd

Unusually, Busan's High-Rise Apartment LCT in Haeundae Appears in Top 10

Except Traumhaus and LCT with First Official Prices, All Top 10 Apartments
Show Over 1 Billion KRW Increase Compared to Last Year

Due to Government's Introduction of 'α Value' Raising Realization Rate Target to 80%

▲ Traum House 5th, Seocho-dong, Seocho-gu, Seoul [Image source=Yonhap News]

[Asia Economy Reporter Lee Chun-hee] The townhouse complex 'Traumhaus 5th' in Seocho-dong, Seocho-gu, Seoul, has held the title of 'the most expensive apartment nationwide' for 15 years since 2006.

According to the Ministry of Land, Infrastructure and Transport on the 18th, the official price of Traumhaus 5th (exclusive area 273.64㎡) this year is 6.992 billion KRW, ranking first among nationwide multi-family housing official prices. It rose by 148 million KRW from last year's 6.864 billion KRW, with an increase rate of only 1.9%.

This complex, known to be owned by chaebol families, consists of 18 households in 3 buildings. It is close to Seoripul Park and the Seoul Arts Center and is evaluated to have a good residential environment using the highest quality materials.

However, unlike Traumhaus 5th, which only increased by about 150 million KRW, the official prices of other top 10 multi-family housing all recorded a large increase of over 1 billion KRW compared to last year. Most of these places had only increased by up to around 200 million KRW last year.

The 2nd place was again the apartment 'Hannam The Hill' (244.78㎡) in Hannam-dong, Yongsan-gu, Seoul. This year's official price was 6.568 billion KRW, up 1 billion KRW from last year's 5.568 billion KRW. Last year's increase was only 108 million KRW compared to 5.46 billion KRW in 2018.

The 3rd place was the apartment 'I-Park' (269.41㎡) in Samseong-dong, Gangnam-gu. This apartment, ranked 7th nationwide last year with an official price of 5.04 billion KRW, surged to 6.56 billion KRW this year, rising by 1.52 billion KRW and climbing rapidly in rank. This place also only increased by 70 million KRW compared to the previous year last year.

The 4th and 5th places were the apartments 'Mark Hills East Wing' (272.81㎡) and 'Mark Hills West Wing' (273.84㎡) in Cheongdam-dong, Gangnam-gu. Their official prices were 6.472 billion KRW and 6.312 billion KRW respectively, rising by about 1 billion KRW compared to the previous year.

Next, the 6th and 7th places were the apartments 'Samseong-dong Sangji REITs Ville Kyleum' (273.14㎡) in Samseong-dong, Gangnam-gu, and 'Sangji REITs Ville Kyleum' (214.95㎡) in Dogok-dong. Both places also saw their official prices rise by around 1.2 to 1.4 billion KRW this year to 6.272 billion KRW and 6.248 billion KRW respectively.

The Acro River Park (234.8㎡) in Banpo-dong, Seocho-gu, which announced the emergence of '1 billion KRW per 3.3㎡' apartments last year, ranked 8th. The official price of this unit was 5.869 billion KRW, up 1.357 billion KRW from last year's 4.512 billion KRW.

▲ View of 'LCT' in Jung-dong, Haeundae-gu, Busan (Provided by POSCO E&C)

This year, unusually, a multi-family housing complex outside Seoul appeared in the nationwide top 10 official price rankings. The protagonist is 'LCT' (244.62㎡) in Jung-dong, Haeundae-gu, Busan, which started occupancy in November last year. The official price for this unit was set at 5.432 billion KRW this year. Since occupancy began only four months ago, the official price was not announced last year. The penthouse, built with only two units on the top floor, the 84th floor, had a sale price of 6.796 billion KRW at the time of sale in 2015, which was 69.89 million KRW per 3.3㎡.

The regions with multi-family housing in the top 10 official price rankings were six in Gangnam-gu, Seoul, one in Yongsan-gu, one in Seocho-gu, and one in Haeundae-gu, Busan.

The large increase in high-priced multi-family housing is analyzed to be due to the government's attempt this year to further raise the realization rate through the 'α value.' The Ministry of Land, Infrastructure and Transport introduced the 'α value' to enhance the realization rate in the official price calculation method for multi-family housing this year. Accordingly, for multi-family housing priced over 3 billion KRW with a realization rate below 80%, the realization rate was raised up to a maximum increase of 12 percentage points, targeting an 80% realization rate.

As a result, the official price increase rate for multi-family housing priced over 3 billion KRW this year was 27.39%, the highest among the price brackets. Compared to last year's increase rate of 13.32%, the increase rate doubled.

This year's increase rates were 26.18% for 1.5 billion KRW to less than 3 billion KRW, 17.27% for 1.2 billion KRW to less than 1.5 billion KRW, 15.2% for 900 million KRW to less than 1.2 billion KRW, 8.52% for 600 million KRW to less than 900 million KRW, 8.52% for 300 million KRW to less than 600 million KRW, 3.93% for 300 million KRW to less than 600 million KRW, and -1.90% for less than 300 million KRW, showing changes in order of price ranges.

The realization rate also rose significantly. The realization rate for multi-family housing priced over 3 billion KRW this year was 79.5%, the highest compared to other brackets. Compared to last year's realization rate of 69.2%, it rose by a substantial 10.3 percentage points.

Kim Young-han, Director of Land Policy at the Ministry of Land, Infrastructure and Transport, explained, "The phenomenon where the realization rate of existing high-priced housing was lower than that of mid- and low-priced housing has persisted for a long time," adding, "We are raising the realization rate relatively to resolve this reversal phenomenon."