59㎡ at 1 Billion KRW with 18:1 Competition... Subscription Frenzy Despite High Prices "Now Is Cheap"

Thousands of applicants flocked to the first-priority subscription for 'Sangdo Prugio Clavenue' in Dongjak-gu, Seoul, and 'Hoban Summit Gaebong' in Guro-gu, which attracted attention with their sale prices higher than the surrounding market prices. More than 3,500 people applied for the non-priority subscription of 'Gwangmyeong Central I-Park,' which sparked controversy over its high sale price of 1.2 billion KRW for the standard 84㎡ unit. It is interpreted that the perception that complexes sold quickly due to adverse factors such as increased construction costs are cheap has spread.

Sangdo Prugio Clavenue Perspective / Image Courtesy of Daewoo E&C

According to the Korea Real Estate Board's subscription website on the 6th, 'Sangdo Prugio Clavenue,' which held its first-priority subscription the previous day, attracted 5,626 applicants for 401 units, recording an average competition rate of 14.0 to 1. The highest competition rate was for the 59㎡B unit, where 336 applicants competed for 19 units, showing a competition rate of 17.7 to 1.

Sangdo Prugio Clavenue, a post-sale complex with a total of 771 units, was priced at an average of 39.63 million KRW per 3.3㎡. The 59㎡ units were priced between 930 million and 1.03 billion KRW, and the 84㎡ units ranged from 1.22 billion to 1.39 billion KRW. Although various options such as balcony expansion and system air conditioning were included, there were concerns that the price was somewhat high considering the location and surrounding market prices. This was due to reasons such as its location on a hill, narrow access roads, and the need for further neighborhood maintenance.

On the same day, 'Hoban Summit Gaebong,' which held a first-priority subscription for 110 units, recorded an average competition rate of 25.2 to 1, with a total of 2,776 applicants. The sale price for this complex was 29.14 million KRW per 3.3㎡, with the 84㎡ units priced between 910 million and 990 million KRW. This was also considered expensive compared to nearby complexes in Guro-gu.

Although the competition rates were not in the hundreds to one, both complexes were evaluated as performing well despite higher-than-expected sale prices. Generally, rising sale prices are a negative factor for subscription competition rates, but it is analyzed that buyers are rushing due to expectations of continued raw material price increases. According to the 'Private Apartment Sale Price Trends' announced by the Housing and Urban Guarantee Corporation (HUG), as of the end of July this year, the nationwide private apartment sale price was 16.25 million KRW per 3.3㎡, an increase of about 11.88% compared to the same month last year (14.53 million KRW).

The subscription fever is not limited to Seoul alone. Gwangmyeong Central I-Park, which became famous for its complexes more expensive than those in Seoul, also received 3,450 applications for 27 units in the first non-priority subscription on the 4th, reaching an average competition rate of 127.8 to 1. By unit size, the 39㎡ units recorded 75.3 to 1 (15 units), and the 84㎡ units recorded 190.9 to 1 (12 units). The sale prices were between 508 million and 518 million KRW for the 39㎡ units, and between 1.181 billion and 1.272 billion KRW for the 84㎡ units. This complex sparked controversy over its high sale price as the standard 84㎡ unit price exceeded 1.2 billion KRW in Gwangmyeong.

Ham Young-jin, head of the Zigbang Big Data Lab, said, "With various subscription-related regulations eased this year, subscription demand waiting for new sales is moving, and due to domestic and international factors, sale prices have steadily risen, spreading the perception that 'now is the cheapest.' However, rather than following the trend, it is necessary to carefully consider the location and sale price and set subscription strategies according to one's financial capacity."