[2026 Outlook] Supply Rises but Competition Intensifies... Auction Market Sees Greater Scrutiny of Properties [Real Estate AtoZ]

Experts Predict Surge in Auction Volume
Economic Downturn and High Interest Rates Lead to More Defaults
Investor Demand Flows into Alternative Investment Markets
Competition Expected to Intensify for Properties in Prime Locations

There are growing expectations that this year’s court auction market will see a significant surge in activity. As high interest rates and the ongoing economic downturn drive more real estate properties to auction, experts predict that government-imposed, stringent real estate measures will concentrate investor interest in the auction market.

According to a survey conducted by The Asia Business Daily on January 12, which gathered responses from 36 experts in academia, research institutes, construction companies, and the financial sector for the “2026 Real Estate Market Outlook,” the experts identified “an increase in available properties” and “a rise in successful bid rates” as the key trends in this year’s auction market.

The volume of auctioned properties is expected to surge compared to previous years. Among the respondents, 26.5% (13 individuals) predicted that the number of properties entering auction due to defaults will increase. Statistics from the court auction information service indicate that the number of real estate auction applications last year surpassed 110,000 for the second consecutive year, matching levels seen during the global financial crisis. However, because a large number of properties were submitted for auction in 2024, many of those applications have yet to reach the bidding stage. As a result, the volume of properties up for auction is expected to flood the market through the second half of this year.

Despite the increase in auction supply, the successful bid rate is not expected to decline easily. A total of 44.9% of respondents (22 individuals) predicted that bidding competition would intensify, leading to higher successful bid rates. Since the October 15 measures designated all of Seoul as a land transaction permit zone, the auction market-where the requirement for actual residence does not apply-has rapidly emerged as an alternative investment destination. According to GGI Auction, the successful bid rate for Seoul apartment auctions last month reached 102.9%, the highest level in three and a half years.

One expert who participated in the survey explained, “This year, the auction market is likely to see a gradual increase in available properties due to the effects of the economic downturn. However, as the market is drawing attention as an alternative investment option in response to the government’s stringent real estate policies, there is a possibility that ample liquidity will flow into the auction market.”

However, investment demand is expected to be selectively concentrated on properties with high investment value, such as those with redevelopment potential or prime locations in the Seoul metropolitan area. Similar to the subscription market, investors in the auction market are likely to carefully screen available properties. If investment demand is heavily focused on properties in key locations, successful bid prices may rise, which could actually lower expected returns.

Another expert who participated in the survey predicted, “While the overall volume of auction properties will increase, investor interest will likely be focused only on a select few properties with strong locations and investment value. This will result in a polarization, with competition intensifying around properties whose location and value have been verified.”