[Exclusive] Gaepo Xi Residence National Appraisal at 3.9 Billion Won, 'Gaepo-dong's Highest Price'... Awakening Gangnam?

Gaepo-dong Sets New Record for Highest Gukpyeong Price... Up 700 Million KRW From Previous Peak
Transactions Nearly Disappeared for Two Years... New High Set After Relocation Notice
Strong Real Demand in Premium Areas Despite Toheoguyeok Regulations
"Potential for Price Surge to Spread From Gaepo-dong to All New Complexes in Gangnam"

'Gaepo Xi Presidents,' a representative reconstruction complex in Gaepo-dong, Gangnam-gu, Seoul, recently set a new record for the highest price of a national standard apartment (Gukpyeong) in the Gaepo-dong area. The complex resumed transactions after the relocation notice, signaling the end of the reconstruction project, was issued just two years after move-in, and the first transaction recorded a new high price. Experts predict that if the record-breaking price trend continues, Gaepo-dong, where a strong demand group emerged following the lifting of Seoul's land transaction permit zone (Toheoguyeok), will serve as a source spreading the rising housing prices to nearby areas.

Gaepo Jazi Presidents exterior view. Photo by Yonhap News.

10 Billion Won Jump in One Month... New Gukpyeong Record in Gaepo-dong Area

According to multiple real estate agencies located in Gaepo-dong, Gangnam-gu, Seoul, on the 17th, the 84㎡ exclusive area unit of Gaepo Xi Presidents recently changed hands at 3.9 billion KRW, setting a new record. This price is 700 million KRW higher than the previous highest price for the same area (3.2 billion KRW in August 2024). It is the highest Gukpyeong price ever recorded for all apartments in Gaepo-dong. Previously, the highest Gukpyeong prices in Gaepo-dong were from The H First I-Park and Gaepo Jugong Complex 5 (each at 3.5 billion KRW). A real estate agency in Gaepo-dong, Agency A, stated, "The unit that set the new record is a royal floor in the royal building."

The complex resumed transactions following the relocation notice announcement by Gangnam District Office on the 11th. With the ownership registration process now possible, previously blocked loans have become available. The record-breaking transaction also occurred after the relocation notice. Prices, which had hovered around 2.8 billion KRW last month, surged by over 1 billion KRW at once.

Although move-in for this complex began in March 2023, the relocation notice was delayed due to issues such as kindergarten site compensation and lawsuits invalidating the completion, prolonging the unregistered status. Since ownership had not been fully transferred, mortgage loans were blocked, and uncertainty over property rights increased, resulting in almost no transactions. Despite being a large complex with thousands of households, only 15 transactions occurred over two years. Gaepo Xi Presidents is a massive complex with a total of 3,375 households, reconstructed from Gaepo Jugong Complex 4.

"Transactions Dry Up in Toheoguyeok, but Real Demand Remains Strong"

On the 24th of last month, Seoul designated the entire Gangnam 3 districts and Yongsan-gu as land transaction permit zones (Toheoguyeok). When designated as a Toheoguyeok, regulations such as restrictions on non-homeowners, a two-year residence obligation, and disposal of existing homes apply. Since the regulation, transaction volumes in the Toheoguyeok areas have dried up. According to the weekly apartment transaction status as of the 15th of April, there were only 4 transactions in Gangnam-gu, 2 in Songpa-gu, and none reported in Seocho-gu and Yongsan-gu.

Gaepo Xi Presidents is also subject to Toheoguyeok regulations. However, the emergence of record-breaking prices indicates that demand to invest in premium areas remains strong. A real estate agency in Gaepo-dong reported, "Even after the regulations, inquiries from waiting buyers who were only waiting for the relocation notice have revived, and some have proceeded to actual contracts." Another agency, Agency B in Gaepo-dong, said, "Transactions suppressed for two years have been unlocked by the relocation notice announcement. Having confirmed the 'real price' of Gaepo Xi Presidents, similar price-level transactions are expected to continue."

As transactions in the large complex of over 3,000 households at Gaepo Xi Presidents become active, there is a high possibility that housing prices in surrounding areas will also fluctuate. Yang Ji-young, Senior Asset Management Consultant at Shinhan Investment Corp., analyzed, "This case shows that demand for top-tier locations is on a different level from temporary buying sentiment, indicating price floors and solid demand." Yang added, "A chain reaction such as price 'matching' in nearby new complexes in Gaepo-dong may occur. If so, sellers of other premium area apartments considered 'equivalent' to Gaepo-dong new complexes may raise their price expectations." It is anticipated that the price movement of Gaepo Xi Presidents could flow from 'Gaepo-dong flagship complex → nearby complexes → entire Gangnam area.'