Only 26 of 53 General Sale Units Contracted
Despite High Price Controversy, Average 19:1 Subscription Success
High Interest Rates and Continued House Price Decline Lead to Many Contract Cancellations
[Asia Economy Reporter Onyu Lim] Despite the successful subscription frenzy, the contract rate for Mapo The Classy in Ahyeon-dong, Mapo-gu, Seoul, managed by CMS, remained at a mere 49%, leading to a flood of non-priority subscriptions known as 'Jumjum'.
According to the real estate industry on the 25th, a non-priority subscription for 27 households of Mapo The Classy will be held on Subscription Home on the 30th. This is a redevelopment apartment complex in Ahyeon 2 District with 1,419 households, which held a general subscription last December.
Despite the real estate downturn caused by high interest rates, 1,028 subscription accounts were submitted for 53 households at that time, recording an average competition rate of 19.4 to 1 and a highest of 154 to 1, showing strong demand. Its location between Ahyeon Station and Ewha Womans University Station on Subway Line 2 offers excellent proximity to major business districts, which was considered an advantage.
However, Mapo The Classy ultimately received a dismal result with a contract rate below 50%. Only 26 out of 53 households signed contracts, resulting in a contract rate of 49%.
It appears that continuous declines in housing prices due to the government's extensive real estate regulation easing led to a surge in winners giving up their contracts. While all areas except the Gangnam 3 districts (Gangnam, Seocho, Songpa) and Yongsan-gu were removed from regulated zones and various tax and loan regulations were eased, housing prices failed to rebound. According to the Korea Real Estate Board, apartment sale prices in Mapo-gu have cumulatively fallen by 1.66% this year (as of January 16).
In particular, the high sale price of Mapo The Classy seems to have been a stumbling block. The sale price of this apartment is 40.13 million KRW per 3.3㎡, the highest ever in the northern Seoul area. Although cheaper compared to nearby new constructions, there was controversy over the high sale price compared to recent subscription complexes. For example, the sale price of Olympic Park Foreon, a reconstruction of Dunchon Jugong in Gangdong-gu, Seoul, is 38.29 million KRW per 3.3㎡.
Meanwhile, the non-priority subscription for Mapo The Classy consists of 1 unit of 59㎡ (exclusive area) A type, 13 units of 84㎡ A type, 7 units of 84㎡ B type, and 6 units of 84㎡ C type. Only non-homeowners residing in Seoul can apply. The announcement of winners will be on the 2nd of next month.
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