[Asia Economy Reporter Noh Kyung-jo] The Mokdong New Town complexes spanning Mokdong and Sinjeong-dong in Yangcheon-gu, Seoul, are experiencing contrasting fortunes due to differences in sale prices based on location. Although the neighborhoods are divided only by subway Line 5 stations Mokdong and Omokgyo, the price drop difference exceeds 200 million KRW.
According to the Ministry of Land, Infrastructure and Transport's real transaction price disclosure system on the 6th, a 66㎡ unit in Mokdong New Town Complex 7, located in Mokdong, was traded for 1.925 billion KRW last month. Compared to the same size unit traded in April last year at around 1.7 billion KRW, the price rose by about 200 million KRW despite the real estate market downturn. A 47㎡ unit in Mokdong New Town Complex 6 recently changed hands for 1.4 billion KRW, showing little adjustment compared to the sale price of 1.47 billion KRW in December last year.
Mokdong is considered the second-best school district after Daechi-dong in Gangnam-gu. Mokun Middle School and Gangseo High School are located in Mokdong, and Mokdong New Town Complex 7, which is in the immediate vicinity of Mokdong Station, is known as the flagship apartment complex. Many academies and commercial facilities are concentrated around Omokgyo Station, attracting students not only from Yangcheon-gu but also from Gangseo-gu, Guro-gu, Gwangmyeong in Gyeonggi Province, and Incheon for educational purposes. This is also why the rental market in Mokdong remains stable. The sales market is also dominated by sellers.
On the other hand, a 51㎡ unit in Mokdong New Town Complex 11 located in Sinjeong-dong, although part of the same complex, was traded last month for 980 million KRW, about 200 million KRW lower than the previous transaction in June (1.165 billion KRW). A 98㎡ unit in Mokdong New Town Complex 13 also dropped significantly from 2.01 billion KRW in May to 1.74 billion KRW in September, a decrease of 270 million KRW.
The relatively insufficient educational and transportation infrastructure compared to Mokdong, along with the designation of the area as a land transaction permission zone, which makes so-called 'gap investment' impossible, have influenced these trends. In April, Seoul extended the land transaction permission zone regulations for areas including Apgujeong-dong, Yeouido, Mokdong, and Seongsu-dong for one more year. Since purchases are only allowed for actual residence purposes, buyers are more sensitive to the surrounding environment. Industry insiders explain that, as a school district, the assigned schools are directly reflected in the housing prices.
An official from a local real estate agency said, "Although overall sales are not many, due to the high demand focused on education, price gaps are inevitable even within the same Mokdong New Town complexes depending on the neighborhood," adding, "However, ongoing redevelopment issues are expected to drive price increases regardless of the complex division."
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