Remodeling Momentum Builds in 'Mayongseong' Area... Record Highs Continue Despite Transaction Slump

Apartment Complexes in Seoul City
Photo by Yonhap News

[Asia Economy Reporter Ryu Tae-min] While some areas in Seoul are showing signs of price declines due to a market slowdown, apartment prices in the districts of Mapo, Yongsan, and Seongdong (Ma-Yong-Seong), located on the outskirts of the city center, continue to hit new record highs daily. The remodeling projects, gaining momentum especially in aging mid-rise complexes in this area, are acting as a positive factor.

According to the maintenance industry on the 7th, the Dowon Samsung Raemian Apartments in Yongsan-gu, Seoul, recently formed a remodeling promotion committee and launched a bidding process to select a construction company. Built in 2001, this complex consists of 15 buildings with 1,458 households, ranging from 4 basement floors to a maximum of 22 floors above ground. The promotion committee aims to start collecting residents' consent forms early next year and complete the establishment of the association by mid-year.

Other complexes in the area are also accelerating their remodeling efforts. The Riverhill Samsung Apartments in Sancheong-dong, Yongsan-gu, launched its remodeling promotion committee last October and is actively pushing forward with gathering residents' opinions and selecting a construction company. This complex was completed in 2001 and consists of 14 buildings with 1,102 households, with a maximum height of 20 floors above ground.

Several complexes in Ichon-dong, known as a representative affluent area in Gangbuk, are on the verge of selecting construction companies. The Ichon Kolon Apartments, with 834 households, selected Samsung C&T as the preferred negotiation partner last September. The association plans to hold a general meeting early next year to finalize the selection of the construction company. The Gangchon Apartments, which received association establishment approval last October, are reportedly preparing for a second round of bidding for construction companies.

Remodeling promotion cases are also emerging in Mapo-gu. The Gongdeok Samsung Raemian 1st Complex, with 651 households, is currently preparing to establish a remodeling association. This complex plans to receive association establishment approval in the first half of next year and begin full-scale remodeling procedures. It is an ultra-station area complex located just 200 meters from Gongdeok Station, which serves subway lines 5 and 6, the Airport Railroad, and the Gyeongui-Jungang Line. Nearby, the Daeheung Taeyoung Complex (1,992 households) has been collecting residents' consent forms for association establishment since August.

As remodeling projects proceed smoothly, apartment prices in the area are also rising. A 59㎡ unit in Dowon Samsung Raemian changed hands for 1.43 billion KRW in October, up 200 million KRW from the previous record of 1.227 billion KRW set in July for the same size. The 59㎡ units in Riverhill Samsung also traded for 1.4 billion KRW in October, rising 293 million KRW from the record high of 1.107 billion KRW in August. The Ichon Kolon 59㎡ units were sold for 1.8 billion KRW in August and September, each 200 million KRW higher than the previous record of 1.6 billion KRW set in March. The Gangchon 59㎡ units signed sales contracts for 1.8 billion KRW in August, marking a 300 million KRW increase in just three months.

Despite the overall slowdown in Seoul's housing price growth, apartment sale prices in these areas continue to rise due to expectations surrounding redevelopment projects. As of the fifth week of November, Yongsan-gu recorded the highest weekly apartment price increase rate in Seoul at 0.23%. Since overtaking Nowon-gu in the second week of October, Yongsan-gu has maintained the highest growth rate in Seoul for eight consecutive weeks. Mapo-gu also recorded a 0.15% increase, the highest rate excluding Yongsan-gu and the Gangnam 3 districts.