Initial Contract Rate 59% Cheolsan Zai Nears Sell-Out
Jangwi Zai Also Running Out of Units After First-Come, First-Served Contracts
Trend of Polarization in Sales Market Depending on Location
Despite the real estate market downturn causing an accumulation of unsold units, news of 'sold-out' properties is coming from various parts of the Seoul metropolitan area. This means that even if initial subscription results were disappointing, apartments in prime locations ultimately attract genuine buyers. Unlike the rapid price surge period when everything sold out indiscriminately, the sales market is now showing signs of polarization.
According to the sales industry on the 26th, Gwangmyeong Cheolsan Xi The Heritage in Gyeonggi-do exceeded a 95% contract rate through a first-come, first-served sales process. Cheolsan Xi is a large complex apartment with 3,804 units located within walking distance of Cheolsan Station on Subway Line 7. In December last year, the average competition rate for the first subscription was 0.97 to 1, and the initial contract rate was only 59%, raising concerns about unsold units. However, after a non-subscription application and first-come, first-served contracts for the remaining units, a complete sell-out is now imminent.
At a similar time, Jangwi Xi Radiant in Seongbuk-gu, Seoul, also saw success. This complex had a low first subscription competition rate of 3.13 to 1. It also had an initial contract rate below 60%, indicating a high possibility of unsold units. The sluggish real estate market and prices higher than surrounding market rates were obstacles. Jangwi Xi was priced at 28.34 million KRW per 3.3㎡, with 59㎡ (exclusive area) units priced in the high 700 million KRW range, and 84㎡ units in the mid-900 million to low 1 billion KRW range. Nevertheless, after conducting non-subscription applications and first-come, first-served sales, all remaining units were sold out.
Olympic Park Foreon, a reconstruction of the Dunchon Jugong apartments in Gangdong-gu, Seoul, which was considered an indicator of the Seoul sales market, also has very few unsold units left. A non-subscription application announcement for residents is expected on March 3. Since non-subscription applications are usually held 5 to 7 days after the announcement, it is likely to take place as early as March 8.
With high interest rates causing continued declines in housing prices, the number of unsold units nationwide exceeded 60,000 as of December last year. Nevertheless, complexes in good locations are steadily clearing remaining units, supported by the government's easing of real estate regulations.
Last December, the government completely removed the ban on interim payment loans based on price and allowed mortgage loans for apartments priced over 1.5 billion KRW. Additionally, last month, all areas except the Gangnam 3 districts (Gangnam, Seocho, Songpa) and Yongsan-gu in Seoul were removed from real estate regulation zones, and regulations on resale restrictions and mandatory residence for new apartments were significantly relaxed.
A sales industry official said, "Although unsold units are accumulating due to the sluggish sales market, most areas with locational advantages are clearing remaining units," adding, "The sales market is showing polarization depending on location and price."
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