Closed Doors and 'Secret Sales'... "Now Elites Can't Buy Below 3 Billion Won" [Unusual Housing Prices]

After Els, Resentz Also Surpasses 3 Billion KRW National Average
"Effectiveness of Crackdowns Questioned, Supply Shortage Further Drives Up Prices"
Elite to Jamsil Jugong Complex 5: The 'Eoljukae' Phenomenon Emerges

On the 14th, Jamsil Jungang Shopping Center near Jamsil Jugong Complex 5 in Songpa-gu, Seoul, was literally a 'ghost shopping center.' More than half of the shops on the first floor were real estate agencies, making it the largest real estate transaction hub in Jamsil, but there was no sign of people. Many of the approximately 30 real estate agencies had their doors closed or lights off. Even those with open doors had no one attending to them. Only 3 to 4 places were operating normally.

The appearance of real estate agents concentrated in Jamsil Central Shopping District on the 14th. Most of the offices were closed. Even among the real estate agents operating in open spaces, no one was present at their posts. Photo by O Yugyo.

After the lifting of the land transaction permission zone (Toheoje), it was expected to become a hotspot for rising house prices, bustling with activity. However, when government inspection teams appeared, a situation unfolded where shops turned off their lights and conducted business outside in a covert manner, leaving the shopping center itself empty. A real estate agent at Jamsil Jungang Shopping Center said, "Since about a week ago, inspections have become so intense that most places close their doors and do not come out," adding, "We are doing 'stealth business' by consulting over the phone and meeting clients directly on-site." With joint crackdowns by Seoul City, the National Tax Service, and Songpa-gu intensifying, a mood of 'let's avoid the storm' has spread.

It was also difficult to find real estate agencies operating properly at the nearby Resentz Shopping Center. Another real estate agent said, "They ask for contract documents for over a year, and if they find even a minor mistake, they immediately impose fines of several million won," adding, "Everyone has no choice but to be cautious." Some places showed extreme wariness, asking, "Why would a reporter come here in such a sensitive time?"

After Els, Resentz Also Hits 3 Billion KRW National Average... Solidifying the Els·Ri·Te '3 Billion KRW' Era

However, despite the intense crackdowns, prices in major Jamsil complexes continue to rise. According to the Ministry of Land, Infrastructure and Transport's actual transaction price system, an 84㎡ unit in Jamsil 'Els' recorded a new high price of 3 billion KRW on the 26th of last month. Compared to the previous transaction for the same area, the price rose by 120 million KRW in just 10 days. This was the first time the so-called 'Elite' (Els, Resentz, Trizium) surpassed the 3 billion KRW national average.

It is also observed that there are quite a few transactions above 3 billion KRW among the Elite that have not yet been officially reported. A real estate agent at Resentz Shopping Center said, "I know that one of the real estate agencies in our shopping center recently handled a transaction for an 84㎡ unit at Resentz for 3.1 billion KRW," adding, "It was a place renovated over a year ago, so the price was somewhat higher than the market price." He also added, "In the future, it will be difficult to see Elite national average transactions below 3 billion KRW."

The previous actual transaction price for the Resentz national average was 2.707 billion KRW on the 17th of last month. The price rose by 400 million KRW in just about a month. Another real estate agent said, "No matter how much inspections try to suppress it, real estate that is going to rise will rise," adding, "In fact, the phenomenon of listings being withheld is causing supply to decrease, which is also contributing to the price increase."

Selling Elite and 'Switching' to Jamsil Jugong Complex 5

Jamsil Jugong Apartment Complex 5. Photo by Heo Younghan younghan@

A 'switching' trend from Elite to Jamsil Jugong Complex 5 is also being observed. A real estate agent at Jamsil Jungang Shopping Center said, "Complex 5 is a large complex with 3,930 households, but there are few listings because many people are 'holding on' due to reconstruction expectations," adding, "We are receiving many inquiries from residents of Elite, and I know that some have recently sold their Elite units and bought in Complex 5." This is the so-called 'Eoljukjae (holding on for reconstruction no matter what)' phenomenon happening in Jamsil.

Jamsil Jugong Complex 5 is scheduled to transform from 3,930 households to 6,491 households after reconstruction. The application for project implementation approval is expected in the second half of this year. With reconstruction gaining momentum and increased demand following the lifting of the land transaction permission zone in Elite, the 'value' is rising. An 82㎡ unit in Jamsil Jugong Complex 5 recorded a new high price of 3.575 billion KRW on the 28th of last month. This was 130 million KRW higher than the previous transaction for the same area. A real estate agent mainly handling Jamsil Jugong Complex 5 said, "The psychology that the price rise is now in full swing is spreading, so people are reluctant to list their properties," adding, "Conversely, prospective buyers are anxious, wondering if they should buy now."