"Buyers Lined Up"?Properties Sold Instantly as Soon as Listed... Mokdong Market Heats Up [Report]

72 Record-High Transactions in Two Months
Listings Dry Up Amid Reconstruction Hopes
Owners Selling Rear Complexes, Buying in the Front
Uncertainty Over Profit Recovery System Remains a Hurdle

"Last week, three 66㎡ (27 pyeong) units in Mokdong Complex 1 were listed for sale, and all of them were sold before the week was over. There are plenty of buyers, but no properties available, so even the real estate agents are left waiting with nothing to do." (Owner of Real Estate Agency A in Mokdong, Yangcheon-gu, Seoul)

On June 10, at Mokdong New Town Apartment Complex 6 in Yangcheon-gu, Seoul, despite it being a weekday afternoon, there were one or two customers sitting inside each real estate agency, receiving consultations. Even the agencies without customers were busy. Through the open doors, you could hear phone calls to nearby agencies asking, "Do you have any listings available?" Along the outer perimeter of the complex, banners from major construction companies such as Samsung C&T, Hyundai Engineering & Construction, and Lotte E&C congratulating the approval of the association establishment were hung in succession, reflecting the heightened expectations for reconstruction. Not only Complex 6, but also agencies around Complexes 5 and 1 saw a steady stream of customers coming in and out every 20 minutes.

Mokdong New Town Apartment Complex 6, Yangcheon-gu, Seoul. Photo by Lee Jieun

With the reconstruction project gaining momentum, housing prices in the Mokdong New Town apartment complexes are surging. Last month, the number of transactions at record-high prices exceeded 50, and a lack of available listings has emerged alongside rising prices.

72 Record-High Transactions in Two Months... Prices Up by About 200 Million Won per Complex

According to the apartment transaction platform "Apt2Me" on June 11, out of 303 apartment sales in Mokdong New Town Complexes 1 to 14 last month, 55 were recorded at new all-time high prices. This indicates that demand is pushing prices upward. As of June 10, there have already been 17 record-high transactions this month.

From the top, Mokdong Complex 1, Complex 5, and Complex 6 views. Photo by Lee Jieun

Both the front and rear complexes have seen prices rise by over 200 million won in the past two months. The "front complexes" refer to Complexes 1 to 7, located in Mokdong for administrative purposes, while the "rear complexes" are Complexes 8 to 14, located in Sinjeong-dong. In May, a 66㎡ unit in Mokdong Complex 6 set a new record at 2.15 billion won, up 170 million won in just two months from 1.98 billion won in March. In Mokdong Complex 5, a 66㎡ unit set a new record at 2.25 billion won on May 28. The same size units changed hands for 1.92 billion won in March and 2.18 billion won in April. Each transaction is setting a new record price. In the rear complexes, Mokdong Complexes 11 and 14 also saw 51㎡ and 55㎡ units set new records last month at 1.48 billion won and 1.59 billion won, respectively.

There are also reports of transactions being closed at prices hundreds of millions of won higher than the officially reported record highs. According to a nearby real estate agency, a 65㎡ (26 pyeong) unit in Mokdong Complex 5 was reportedly sold for 2.5 billion won last week. There are also reports that a 65㎡ unit in Mokdong Complex 1, which set a record at 2.07 billion won last month, changed hands for 2.24 billion won last week.

As Reconstruction Accelerates... Owners Selling Rear Complexes and Moving to the Front

With all 14 complexes, led by Mokdong Complex 6, seeing their reconstruction projects accelerate, it is believed that investment demand is surging due to expectations of further price increases. Mokdong New Town Apartments, with a total of 26,629 units, is a representative aging complex in southwestern Seoul. Currently, all 14 complexes are on track for reconstruction. Among them, Complexes 6, 8, 12, 13, and 14 have completed the official designation as maintenance zones. The remaining complexes have finished the public review of their maintenance plans and are expected to receive official designation within the year.

Banners congratulating the approval of the association establishment by construction companies are hung in Mokdong New Town Complex 6, Yangcheon-gu, Seoul. Photo by Lee Ji-eun

Investment demand is particularly concentrated in the front complexes, especially in Mokdong Complex 6, which is progressing the fastest. Mokdong Complex 6 held its inaugural general meeting on May 10 and received approval for association establishment on May 22. The complex sped up the process by directly establishing the association, bypassing the preparatory committee stage. Normally, it takes three years and nine months from the formation of the preparatory committee to the approval of the association.

As the reconstruction timeline accelerates, there are even signs in the market of owners selling units in the rear complexes and moving to the front complexes. Among the 14 complexes, Complex 7 is the most sought after for its prime location adjacent to Mokdong Station on Subway Line 5, Complex 5 is attractive for its low floor area ratio and strong business potential, and Complex 6 is favored for its rapid reconstruction progress.

A nearby real estate agent explained, "Investors who prioritize reconstruction speed prefer Complex 6, while those who value location or business potential look to Complexes 7 or 5. Although there are concerns about the installation of a combined heat and power plant in Complex 1, it remains popular due to its value for money." The agent added, "For Complex 7, even units of the same size can differ by 100 to 200 million won compared to other complexes. Many clients are inquiring about selling their rear complex units and moving to the front complexes."

This situation is expected to continue for the time being. While demand is concentrated, listings have dried up. In anticipation of further price increases, homeowners are pulling their properties off the market. Currently, in Mokdong Complex 6, only three listings-one 95㎡ and two 47㎡ units-are available out of a total of 1,362 units. In Mokdong Complex 7, where investment demand is highest, two 66㎡ (27 pyeong) units are listed at asking prices of 2.6 billion and 2.7 billion won, respectively. The owner of Real Estate Agency B near Mokdong Complex 5 said, "There are virtually no listings for units in the 30-pyeong range. Even the few properties that are on the market are being withdrawn by owners as prices keep rising."

Kim Jaekyung, head of Tumi Real Estate Consulting, stated, "After the expansion of land transaction permit zones, demand that had been searching for less regulated areas in Gangnam has shifted to Mokdong, which is considered a prime location. Given the strong business potential of Mokdong's reconstruction complexes, investment demand is expected to increase further going forward."

On the other hand, the uncertainty surrounding the abolition of the Reconstruction Excess Profit Recovery System (commonly known as "Rechowan") following the inauguration of the new administration is acting as a stumbling block. In the past, President Lee Jaemyung expressed his intention to maintain the system, stating, "Excessive profits generated from reconstruction should be returned to society for the public good."

Kim added, "For apartment complexes with strong business potential like those in Mokdong, the burden from the recovery of excess reconstruction profits could be substantial. Whether or not the system is implemented will be a major variable for these projects."