Location over newness... Top-tier Apgujeong apartments hit consecutive record prices

Transfer of Union Member Status Allowed
Property Prices Soar by Hundreds of Millions in a Few Months
Sales Continue Despite Actual Residence Requirement
Alternative to High Prices of New Constructions

"Investors in their 30s and 40s who can wait for reconstruction are buying properties while considering actual residence. Everyone expects that the land transaction permission zone in Apgujeong will be maintained, so the asking prices have not dropped even after the announcement." (Apgujeong-dong B Real Estate Agency)

Old apartments in Apgujeong, Gangnam-gu, Seoul, are continuously breaking record prices. Since last year, as the transfer of union member status became possible, investors have turned their attention to Apgujeong reconstruction apartments. Some complexes have seen prices rise by about 700 million to 800 million KRW over the past year. Apgujeong remains a land transaction permission zone, requiring buyers to actually reside in the property, but it is considered a prime location in Gangnam, attracting wealthy investors' interest.

Apgujeong Record Prices Keep Being Updated

According to the Ministry of Land, Infrastructure and Transport's actual transaction price system on the 17th, Hyundai 13th Complex in Apgujeong 3 District set a new record last month when a 105㎡ (7th floor) unit on the 4th floor was traded for 5 billion KRW. In December last year, a 7th-floor unit of the same size was also sold for 5 billion KRW. In just five months, the price rose by 500 million KRW from the previous record of 4.5 billion KRW. Asking prices have recently far exceeded actual transaction prices. Currently, asking prices for units of the same size range from 4.9 billion KRW to a maximum of 5.5 billion KRW.

Hyundai 5th Complex in Apgujeong saw a 82㎡ (13th floor) unit change hands for 4.8 billion KRW in December last year. Hyundai 5th Complex had previously set new records three times last year, with transactions at 4.48 billion KRW in August and 4.798 billion KRW in October. Asking prices for the same size units have now soared to 5.5 billion KRW. A representative from Apgujeong A Real Estate said, "We receive calls several times a day asking if there are any units available. Owners are trying to raise prices."

In the case of Hyundai 6th Complex in Apgujeong, a 196㎡ unit on the 5th floor was traded for 7.95 billion KRW last month. This is 470 million KRW higher than the previous highest price in August (7.48 billion KRW). Asking prices have reached up to 8.8 billion KRW. Hyundai 8th Complex in Apgujeong 4 District set a new record last December when a 107㎡ unit was sold for 4.45 billion KRW. The previous record was 4.08 billion KRW in July last year, rising by 370 million KRW in just two months. Asking prices for Hyundai 8th Complex units of the same size are currently listed up to 5.2 billion KRW.

Since the Unlocking of Union Member Status Transfer... Price Increase of 700 Million to 800 Million KRW

Since the first half of last year, as the restriction on transferring union member status was lifted in Apgujeong apartment complexes, a series of record prices have emerged. According to current law, in reconstruction complexes within speculative overheated districts, union member status can only be transferred for one household one property units that have been held for 10 years and occupied for 5 years after the union establishment approval. However, if the business implementation plan approval is not applied for within 3 years after union establishment, union member status can be transferred. Apgujeong 2 and 3 Districts passed the 3-year mark after union establishment approval in April last year, and 4 and 5 Districts in February last year, allowing union member status transfer.

Some places have seen prices rise by 700 million to 800 million KRW in less than a year. Hyundai 13th Complex in Apgujeong 3 District had no transactions since May 2023, but a 105㎡ unit was traded for 4.25 billion KRW in April last year. The same size unit set a new record at 5 billion KRW in December last year and January this year, marking a 750 million KRW increase since union member status transfer became possible. Hyundai 8th Complex in Apgujeong 4 District had no transactions for 8 months since August 2023, but a 107㎡ unit was traded for 3.6 billion KRW in April last year. It then set a new record at 4.45 billion KRW in December last year, rising by a remarkable 850 million KRW.

Apgujeong Hyundai Apartment. Photo by Hyunmin Kim

Demand to enter Apgujeong persists even if buyers must endure actual residence requirements. Reconstruction complexes in Apgujeong are designated as land transaction permission zones, requiring buyers to reside for two years after purchase. A representative from a B real estate agency near Apgujeong-dong explained, "Properties are coming onto the market mainly from elderly people who find it difficult to wait any longer for reconstruction."

Cheaper than New Buildings in Banpo... Expected Value Increase upon Reconstruction

The price increase of new apartments within the Gangnam 3 District is also fueling the price rise of apartments in Apgujeong. According to the real estate brokerage platform Zigbang, the price per pyeong (3.3㎡) of Raemian One Bailey in Banpo-dong, Seocho-gu, which began occupancy in August 2023, is 155.82 million KRW. In contrast, the price per pyeong of Hyundai 8th and Hyundai 13th Complexes in Apgujeong is lower, at 119.52 million KRW and 136.04 million KRW, respectively.

Kim Je-kyung, director of Toomi Real Estate Consulting, explained, "As prices of new apartments in Banpo have soared recently, demand that intended to purchase in Banpo seems to be turning their attention to Apgujeong reconstruction. Moreover, despite being older buildings, Hyundai apartments in Apgujeong have excellent locations, and there are forecasts that their price per pyeong will become the highest in the country after reconstruction."