Real Estate 114 Analysis: Seoul Leads with Highest Ever Subscription Competition Rate of 99.3 to 1, Outpacing Provinces in Capital Area for First Time in 10 Years
Subscription Fever Drives Record Competition Rates
[Asia Economy Reporter Yuri Kim] The subscription market in the Seoul metropolitan area, including Seoul, is showing signs of overheating.
According to Real Estate 114 on the 15th, the average subscription competition rate for apartments in the metropolitan area until June 11 this year recorded 40.7 to 1, more than twice as high as the 18.3 to 1 in provincial areas. This is the first time since 2010 that the average subscription competition rate for metropolitan apartments has surpassed that of provincial areas. Seoul recorded an all-time high of 99.3 to 1.
As subscription competition heats up, the number of complexes with competition rates exceeding 100 to 1 has also increased. Among 130 apartments nationwide that received subscription applications this year (56 in the metropolitan area, 74 in provincial areas), 16 recorded competition rates of 100 to 1 or higher, with 12 of these located in the metropolitan area. This means that one out of every five apartments sold in the metropolitan area recorded a competition rate of over 100 to 1.
In Seoul, half of the eight complexes sold this year?four in total?showed subscription results exceeding 100 to 1. The public sale complex Magok District 9 recorded the fiercest competition at 146.8 to 1. In Gyeonggi Province, five out of 33 sold apartments recorded competition rates above 100 to 1. The most popular apartment was Gwacheon Jadeja, which attracted about 25,000 applicants in the first subscription round. As the first public sale apartment in Gwacheon Knowledge Information Town, it was priced lower than the surrounding market prices, attracting a large influx of subscription demand. In Incheon, Bupyeong Station Hanla Vivaldi Treviang, supplied in April this year, recorded a competition rate of 251.9 to 1, the highest subscription result in Incheon since 2000. In Incheon, a non-regulated area, all apartments sold this year were closed in the first subscription round due to high demand.
Among the entire metropolitan area, the most prominent overheating region is undoubtedly Seoul. Although Seoul is designated as a speculative overheating district and is subject to the strictest regulations, the subscription fever is the hottest nationwide. This year, Seoul’s apartment subscription competition rate is 99.3 to 1, approaching 100 to 1. This is the highest competition rate since data collection began in 2000 and is more than twice as high as those in Gyeonggi and Incheon. Real Estate 114 analyzed that concerns over a decrease in new supply in Seoul due to the implementation of the price ceiling system starting at the end of July have highlighted the scarcity value, and the pricing being similar to or lower than surrounding market prices has increased expectations for capital gains.
This subscription fever in the metropolitan area is expected to continue in the second half of the year. Kyunghee Yeo, Senior Researcher at Real Estate 114, said, "With the strengthening of resale restrictions until ownership transfer registration in August, demand to secure resalable pre-sale rights is expected to flow into the subscription market in June and July. However, from August, when resale will be restricted, and if the mandatory maximum five-year residence for private land price ceiling housing currently under discussion is implemented, some speculative demand may be curbed, and the subscription fever may slightly calm down."
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