The Unusual Phenomenon Caused by the Sale Price Ceiling System
Recently, the price inversion phenomenon between apartments and officetels being sold has been intensifying. Apartment prices are suppressed due to the price ceiling system, while officetels, which are not subject to regulations, continue their soaring prices. There has even been a case where the apartment prices in Gwacheon-si, also known as 'Jun-Gangnam,' are lower than the officetel prices in Paju-si.
On the 25th, sales announcements were made for apartments and officetels in Gwacheon-si and Paju-si, Gyeonggi-do, respectively. The apartment is 'Gwacheon Hanyang Sujain,' and the officetel is 'Hillstate The Unjeong.'
Gwacheon Hanyang Sujain is regarded as a '1 billion won lottery apartment' because the price ceiling system applies, making its price cheaper than the surrounding market price. This apartment, consisting of 174 units with exclusive areas of 59 to 84㎡, has prices (based on the highest price) of 654.2 million KRW for 59㎡ and 886 million KRW for 84㎡. For the 84㎡ units, the difference compared to the asking prices of nearby apartment complexes exceeds 1 billion KRW.
The apartment's price attracted more attention when compared to the officetel announced on the same day. The Hillstate The Unjeong officetel in Wadong-dong, Paju-si, offering 2,669 units, has prices for 84㎡ units ranging from 885.2 million to 895.8 million KRW. Based on the highest price for that size, the officetel is more expensive than Gwacheon Hanyang Sujain. Even considering the merits of a large complex and the GTX development, the price was evaluated as somewhat high.
The main reason for the higher officetel prices is attributed to the price ceiling regulation implemented since July last year. Private supply apartments are subject to the ceiling system, resulting in prices set lower than market prices, but officetels are not subject to this system, allowing developers and construction companies to freely set prices.
The price inversion between apartments and officetels has become more pronounced this year. There have even been cases of price inversion between officetels and apartments within the same complex.
A representative example is 'Dongtan Station Dietre Prestige,' sold in the first half of this year. The officetel's 84㎡ unit price was 916.6 million KRW, more than twice the apartment price for the same size in the same complex, which ranged from 440.34 million to 488.67 million KRW.
Officetel prices themselves are also soaring. The 'Hillstate Gwacheon Government Complex Station' officetel, sold earlier this month, had prices for 84㎡ units ranging from 1.5 to 1.6 billion KRW, about 60 million KRW per 3.3㎡. This is more expensive than the 'Raemian One Bailey' in Banpo-dong, Seocho-gu, Seoul, which had a controversial high price of 56.67 million KRW per 3.3㎡.
An industry insider said, "Besides the price ceiling system, loan regulations and tax strengthening have also contributed to the skyrocketing officetel prices." He added, "As it became difficult to secure apartments, demand shifted to officetels, which have a lower entry barrier. With apartment prices soaring and even signs of panic buying of officetels emerging, the soaring prices of officetel sales and transactions were predictable."
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