'1 Billion Lotto' Gwacheon Non-Sequential Subscription Attracts 7,579 Applicants for 10 Units

Photo by Asia Economy dB

[Asia Economy Reporter Ryu Tae-min] More than 10,000 people flocked to the non-designated apartment subscription in Gwacheon-si and Hanam-si, Gyeonggi Province, where winners can expect capital gains exceeding 1 billion KRW. The popularity is attributed to the strong expectations as the apartments were offered at prices significantly lower than the surrounding market prices.

According to the Korea Real Estate Board's subscription website on the 6th, 7,579 people applied for 10 general supply units in the non-designated subscription for Gwacheon Xi in Byeolyang-dong, Gwacheon-si, held on the 4th. The 84㎡ (exclusive area) unit had the highest competition rate with 1,832 applicants for one unit, and the remaining 59㎡ units also showed triple-digit competition rates.

Non-designated subscription refers to accepting new applications for remaining units that occur due to non-contracts or disqualifications after the initial resident recruitment. Anyone aged 19 or older residing in the relevant area can apply without restrictions such as holding a subscription savings account or being a non-homeowner.

The popularity is due to the high expectations of capital gains. The 84㎡ unit in this complex was traded for 2.05 billion KRW on the 16th of last month. Considering the non-designated subscription price of 976.8 million KRW for the 84㎡ unit, buyers can expect capital gains exceeding 1 billion KRW. The 59㎡ units are also priced significantly lower than actual transaction prices, ranging from 817.9 million KRW to 916.3 million KRW.

Earlier, on the 3rd, a special supply non-designated subscription for two 59㎡ units in this complex attracted a total of 230 applicants. There were 123 applicants for one unit reserved for elderly parent support and 107 applicants for one unit for multi-child families.

The low entry barrier is also cited as a reason for the popularity. This complex has no mandatory residence period, so buyers can pay only 20% of the contract amount and find tenants to pay the remaining balance. Additionally, anyone aged 19 or older residing in Gwacheon and who is a non-homeowner household head can apply, and since the selection is by lottery, prospective applicants with low scores flocked. Once the ownership transfer registration is completed, resale is also possible.

In Hakam-dong, Hanam-si, ‘Wirye Foret Xi’ recorded a competition rate of 4,030 to 1 with 4,030 applicants for one 131㎡ unit in the non-designated subscription held on the 3rd. The sale price for this unit was 925.21 million KRW, while the market price for similar units in nearby new complexes was estimated at around 2 billion KRW. Despite only non-homeowner household members residing in Hanam-si being eligible to apply, the high expectations of capital gains attracted many applicants.

However, this complex is subject to the price ceiling system as it was supplied through private sales on public land in the Seoul metropolitan speculative overheated district. A mandatory residence period of five years applies after moving in, and resale is prohibited for ten years. Despite these restrictions, many actual demand buyers aiming for the low sale price appear to have gathered.

Meanwhile, in May, the non-designated subscription for ‘Gwacheon Weverfield’ in Wonmun-dong, Gwacheon-si, attracted a total of 8,531 applicants for four units, recording a high average competition rate of 2,132 to 1.