[Asia Economy Reporter Noh Kyung-jo] In Magok District, Gangseo-gu, where prices had been rising due to new town-level development in Seoul, transactions showing a drop of 400 million to 600 million KRW compared to the previous deals are emerging one after another.
According to the Ministry of Land, Infrastructure and Transport's real transaction price disclosure system on the 21st, an 84㎡ unit in Magok M Valley Complex 8 was traded for 1.15 billion KRW on the 8th. This is the first transaction of an 84㎡ unit in this complex in about a year and a half, as there were '0 transactions' last year. The price level is similar to that of early 2021.
An 84㎡ unit in Magok M Valley Complex 6, which was actually traded for 1.65 billion KRW in the first half of last year, was recently traded for 1.08 billion KRW. This represents a drop of about 600 million KRW in about a year. Magok 13 Complex Hillstate Master, the only private complex among Magok M Valley complexes, also welcomed new owners this month at 1.185 billion KRW and 1.19 billion KRW respectively for 84㎡ units. Compared to January last year (1.56 billion KRW), the price has dropped by nearly 400 million KRW.
Other Magok M Valley complexes have had no sales transactions or only one or two since last year. As the real estate market downturn deepens and the transaction cliff spreads, homeowners have locked their doors.
As such, while holding out centered on Magok District has continued, low-price transactions have appeared one by one this year, causing apartment prices in Gangseo-gu to fall sharply compared to other areas in Seoul. According to the Korea Real Estate Board, the cumulative sales price change rate in Gangseo-gu as of the second week of February this year was -4.16%, the largest drop among Seoul's autonomous districts. This contrasts with last year's relatively stable change rate of 0.11%.
However, local real estate agents said that Magok District, where development projects are underway, should be viewed from a mid- to long-term perspective. Magok District serves as a link between Yeouido and Incheon. It is currently undergoing additional development as one of the seven major metropolitan centers in the '2030 Seoul Plan.' LG Group's research and development (R&D) hub, LG Science Park, opened in 2018, and many large and medium-sized companies such as Lotte, Nexen, and Kolon have moved in.
One real estate agent said, "We should also consider positive factors such as the development of the MICE (Meetings, Incentives, Conventions, and Exhibitions) complex and the relocation of the Gangseo-gu Office building," adding, "Quality jobs created by regional development will also compensate for weaknesses such as school districts."
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