Seoul Real Estate Market Faces Cold Spell, but New Developments Sell Out... Competition Rate Drops Compared to Last Year

Bukseoul Xi Polaris 1st Priority Competition Rate 34.43 to 1
High Prices and Location Cause Lower Competition Rate Than Last Year
"Loan Regulations Also Affect the Sales Market... Selective Applications Will Become Clearer"

[Asia Economy Reporter Kim Hyemin] The first apartments sold in Seoul this year were completely sold out in the first-priority subscription, reaffirming the strong demand for housing subscriptions. This contrasts sharply with the sharp decline in transactions of older apartments due to loan regulations. However, the competition rate was lower compared to last year due to controversies over high sale prices.

According to the Korea Real Estate Board's Subscription Home on the 25th, all housing types in Gangbuk-gu's 'Bukseoul Xi Polaris' were closed within the local area (residents who have continuously lived in Seoul for more than two years) in the first-priority subscription. With 295 units available, 10,157 applicants applied, recording an average competition rate of 34.43 to 1.

The highest competition rate was seen in the 59㎡A exclusive area. With 9 units available, 2,174 people applied, reaching a competition rate of 241.56 to 1. The 112㎡ exclusive area attracted the most applicants, with 2,262 people applying for 62 units. This type exceeds the national housing size of 84㎡ and has an equal mix of points-based and lottery-based allocations. It appears that first-home owners and people in their 20s and 30s with low points applied in large numbers, hoping to win. In the special supply subscription held on the 21st, 6,026 people applied for 4 units for first-time homebuyers, recording a high competition rate of 1,506.5 to 1.

This is analyzed to be effective because it is a large complex and a large construction company brand sale that has appeared in Seoul, where the supply drought has continued for a long time. Yeo Kyung-hee, senior researcher at Real Estate R114, said, "The competition rate is not bad for the first start this year," adding, "Although buying demand has sharply decreased due to loan restrictions since last year, it shows that there is still a large waiting demand for buying in Seoul."

However, despite the advantages of being in Seoul, a double subway station area, and a newly built large complex, the subscription competition rate is notable for falling below last year's average. According to Real Estate R114, the average subscription competition rate in Seoul last year was 164.13 to 1. The competition rate for Harrington Place Anam, located near Gangbuk-gu in Seongbuk-gu, was about 192.53 to 1 on average.

Experts believe that the lack of application of the sale price ceiling system caused the supply price to be set higher than expected, lowering the subscription competition rate. Gangbuk-gu is a speculative overheating district but is not subject to the sale price ceiling system. Because of this, the 84㎡ exclusive area exceeded 900 million KRW, making it impossible to receive interim payment loans. The highest price was 1.031 billion KRW, almost the same as the sale price of nearby flagship apartments.

Usually, even if the price difference is small, subscriptions flood in when the location is good or during price increases, but Bukseoul Xi Polaris is analyzed to have missed this trend as well. Yang Ji-young, director of R&C Research Institute, said, "There are still many waiting applicants, but with loan regulations and stagnant house prices, the mentality of using subscription savings for a single smart home will become stronger in the future."