Seodaemun-gu Hong Eun 13 District, Sale Price Set at 29.1 Million KRW per Pyeong
84㎡ Expected to be in the High 900 Million KRW Range
Surrounding Market Prices Declining... Concerns Over Uncertain Success Due to Blocked Interim Loan
[Asia Economy Reporter Kim Hyemin] As redevelopment project complexes in the Seoul area are steadily finalizing their sales schedules, it has been revealed that the sale prices based on the standard 국민평형 (exclusive area 84㎡) are consecutively exceeding 900 million KRW. Due to factors such as rising raw material costs, the 900 million KRW threshold, above which mid-term payment loans are not possible, is becoming established even in areas subject to the price ceiling system. While sale prices are rising, housing prices have entered a downward trend, raising concerns that the subscription market may shrink further.
According to the real estate industry on the 26th, Seodaemun-gu Office recently set the maximum sale price per 3.3㎡ for Hong Eun 13 District (Seodaemun Central I-Park) at 29.1 million KRW. Hong Eun 13 District is an area subject to the price ceiling system. The project involves redeveloping the 11-111 area of Seodaemun-gu, constructing 12 buildings from basement level 2 to ground level 15, totaling 827 households. Among these, 409 units are allocated for special supply and general sale.
With the resident recruitment announcement scheduled for the 11th of next month, applying the maximum sale price per pyeong, the exclusive 59㎡ units are expected to be around 700 million KRW, and the 84㎡ units are anticipated to be in the high 900 million KRW range. Although these are branded apartments with medium to large sizes, considering the location on the outskirts of Seoul and the distance from subway stations, the high sale price is regarded as notable despite being in a price ceiling system area.
Previously, other northern Seoul areas also saw cases where the sale price for 84㎡ units exceeded 900 million KRW. Similar to Hong Eun 13 District, Jangwi 4 District in Seongbuk-gu, which is subject to the price ceiling system, was calculated at 28.34 million KRW per 3.3㎡. In areas not subject to the price ceiling system, Jungnang-gu Jung-hwa 1 District, which underwent high-price screening by the Housing and Urban Guarantee Corporation (HUG), received 28.35 million KRW per 3.3㎡. Converted to 84㎡, this amounts to roughly the mid-900 million KRW range.
As such, with high sale prices being set even in redevelopment sites on the outskirts of Seoul, there are concerns that the price advantage in the subscription market is disappearing. Conversely, with surrounding housing prices falling, it is becoming difficult to guarantee subscription success even in Seoul. In fact, an 84㎡ unit in Bukhansan Doosan We've 1st Phase near Hong Eun 13 District was traded for 990 million KRW in April this year. Raemian Jangwi Fore County, near Jangwi 4 District, was traded for 920 million KRW for the same area on the 4th of this month.
Although the sale price for 국민평형 units in price ceiling system areas exceeds 900 million KRW, the fact that mid-term payment loans are not possible above 900 million KRW is also a factor making subscription difficult. Given the likelihood of further price increases due to inflation-driven raw material and construction cost rises, the market may ultimately become accessible only to buyers with strong financial capacity.
Yeokyung Hee, Senior Researcher at Real Estate R114, said, "Since there is a large number of waiting demand, the subscription competition rate for the current year can be closed," but added, "Because these areas are strongly affected by loan regulations, if the sale price is set higher than the surrounding market price, it is difficult to expect as high a competition rate as before. Large redevelopment projects may also show competition rate variations depending on unit size."
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