Sanggye-dong and Chang-dong Reconstruction 'Smooth Sailing'... Will Northeast Area Housing Prices Rise Further?

Northeast's Largest Reconstruction Project Jugong 17 Complex Passes Preliminary Safety Inspection on 8th
Changdong Sang-A 1st Complex Also Passes on Same Day
Last Month, Nearby Nowon’s Sanggye Jugong 9 & 13 Complexes Passed Preliminary Inspection in Succession
Apartment Prices in Area Rise Together on Reconstruction Expectations

[Asia Economy Reporter Ryu Tae-min] The reconstruction of apartments in the Dobong-gu area of Seoul is gaining momentum. Following Changdong Sang-A 1st Complex, the Jugong Apartments in the Changdong area are also consecutively passing the preliminary safety inspections.

According to the maintenance industry on the 12th, Changdong Jugong 17 Complex received a D grade preliminary safety inspection (on-site survey) notification from Dobong-gu Office on the 8th. Changdong Sang-A 1st Complex also passed the preliminary safety inspection on the same day.

Jugong 17 Complex is a large complex consisting of 11 buildings and 1,980 households, completed in 1989. Sang-A 1st Complex, completed in 1987, consists of 5 buildings and 694 households. In addition, the nearby Jugong 3 Complex, with nearly 3,000 households, is also pushing forward with the preliminary safety inspection, raising expectations for reconstruction in the area.

Reconstruction safety inspections consist of three stages: preliminary safety inspection, detailed safety inspection, and appropriateness review. According to Dobong-gu Office, among the seven Jugong complexes in Changdong (Complexes 1 to 4 and 17 to 19), three complexes?17, 18, and 19?have passed the preliminary safety inspection. Complexes 18 and 19, which passed the preliminary safety inspection before Complex 17, appear to be expediting the detailed safety inspection process. Complexes 1 and 4 are reported to have started gathering opinions to promote reconstruction.

With growing expectations for reconstruction, apartments in the area are consecutively recording new high prices. The 36㎡ unit in Jugong 17 Complex was sold for 500 million KRW on the 15th of last month, rising about 150 million KRW compared to the mid-300 million KRW range at the beginning of the year. During the same period, the 45㎡ unit in Sang-A 1st Complex increased from 500 million KRW to 600 million KRW, rising 100 million KRW in just four months.

In nearby Nowon-gu, news of passing preliminary safety inspections is also coming in one after another, indicating that reconstruction in the northeastern region is progressing smoothly. Nowon-gu's Sangye Jugong 9 Complex, with 2,830 households, and Sangye Jugong 13 Complex, with 939 households, both passed the preliminary safety inspection at the end of last month. These complexes plan to apply for detailed safety inspections as soon as they secure deposits of 200 to 300 million KRW from residents.

According to KB Kookmin Bank's Live On on the same day, the apartment sale prices in Seoul for the fifth week of May rose by 0.37%, an increase from the previous week. Nowon-gu (0.42%) has maintained a high growth rate around 0.5% for the past two months except for one week, leading the rise in Seoul housing prices along with Dobong-gu. This is about twice the level of the average weekly increase of 0.2 to 0.3% in Seoul apartment prices.