Inflow of Buyers Targeting Gangnam Entry and Capital Gains
Average Competition Rate in Gangnam 3 Districts from Jan to Aug: 221 to 1
Average Competition Rate in Seoul Excluding Gangnam 3 Districts: 64 to 1
Cheongdam Le El Surpasses Raemian Onepentas
Competition for subscription to apartment complexes in the Gangnam area of Seoul is becoming increasingly fierce day by day. This is because the application of the price ceiling system has made the supply prices competitive, leading to a growing perception of these apartments as 'lottery apartments.'
According to data from the Korea Real Estate Board's Subscription Home on the 22nd, a total of four complexes were supplied in the three Gangnam districts of Seoul (Gangnam, Seocho, Songpa) from January to August this year. A total of 216,987 people applied for 980 general supply units, recording an average competition rate of 221.42 to 1 for the first priority. During the same period, the first-priority subscription competition rate for apartments in Seoul excluding the three Gangnam districts was 63.75 to 1, making the competition rate for Gangnam 3 districts more than three times higher.
The background for the high competition rate in the triple digits on average is price competitiveness. Since the supply prices differ from the surrounding market prices by as little as 200 to 300 million KRW to as much as several billion KRW, a large number of real demanders who want to enter Gangnam as well as those seeking capital gains have flocked.
The 'Raemian Onepentas,' which recorded the highest first-priority competition rate in the Gangnam area until August, closed with an average of 527.44 to 1. The supply price for the 84㎡ unit of Raemian Onepentas started from the low 2 billion KRW range. Compared to nearby complexes where transactions were made in the 4 to 5 billion KRW range, it was only about half the price, earning it the nickname '2 billion lottery.'
The 'Maple Xi' in Seocho-gu, supplied in February, had a first-priority competition rate of 442.32 to 1, with the 59㎡ unit priced in the 1.7 billion KRW range, about 1 billion KRW cheaper than the nearby 'Shinbanpo Xi' 59㎡ unit (June, 2.7 billion KRW). The 'Raemian Reventus,' supplied in Gangnam-gu in August, also gained a reputation as a lottery apartment, recording an average first-priority competition rate of 402.97 to 1. The 84㎡ unit of Raemian Reventus was priced in the 2.1 billion KRW range, while the nearby Dogok Rexle 84㎡ unit was traded last month at 3.33 billion KRW, securing a safety margin of over 1 billion KRW.
The complex with the highest competition rate in the Gangnam area changed this month. On the 20th, the first-priority subscription results for 'Cheongdam Le El' showed that 56,717 people applied for 85 units, recording an average competition rate of 667.3 to 1. This surpassed the previous highest competition rate of 'Raemian Onepentas' (527.44 to 1) until August this year. In the special supply subscription, 20,070 people applied for 64 units, recording an average competition rate of 313.6 to 1.
A real estate industry official explained, "In the recent situation where both house prices and supply prices are soaring rapidly without discrimination, interest in Gangnam area apartments under the price ceiling system is rising as they reduce the burden on demanders while allowing them to enjoy a significant premium after moving in through price matching." He added, "Since there are various factors that could drive up supply prices, such as increased construction costs due to rising raw material prices, demand concentration on price ceiling system complexes in the Gangnam area is expected to be prominent."
Major reconstruction and redevelopment project subscriptions are scheduled in the Gangnam 3 districts after October as well. Samsung C&T and HDC Hyundai Development Consortium will supply 'Jamsil Raemian I-Park' in the Sincheon-dong area of Songpa-gu in October. This complex is supplied through the Jamsil Jinju Apartment reconstruction project, consisting of 23 buildings with a total of 2,678 units, ranging from 4 basement floors to a maximum of 35 floors above ground. Among them, 589 units with sizes from 43 to 104㎡ are for general sale.
Samsung C&T plans to supply 'Raemian Oneperla' through the redevelopment of Bangbae 6 district in Bangbae-dong, Seocho-gu within this year. It consists of 16 buildings from 4 basement floors to 22 floors above ground, totaling 1,097 units. Among them, 465 units sized 59 and 84㎡ are for general sale.
Hyundai Construction plans to supply 'The H Daechi Edelweiss' next month through the reconstruction of Daechi-dong Gumaeul 3 district in Daechi-dong, Gangnam-gu. It consists of 8 buildings from 4 basement floors to a maximum of 16 floors above ground, totaling 282 units. Among them, 72 units sized 59 to 94㎡ will be supplied for general sale.
© The Asia Business Daily(www.asiae.co.kr). All rights reserved.
