Seoul Apartment Bid Price Ratios Fall from Previous Week... High-Priced Bids in Gangdong and Seongdong Persist [Real Estate AtoZ]

Gangdong-gu and Seongdong-gu See Successful Bid Price Ratios in the 120% Range
Successful Bid Rate Falls on Repeated Failures for Less-Preferred Outlying Complexes
Aggressive Bidding Concentrated on Properties in Preferred Locations

In the second week of February, the successful bid price ratio for apartments in Seoul fell compared with the previous week, slightly slowing its upward trend. In contrast, Gangdong-gu and Seongdong-gu recorded ratios above the overall Seoul average, indicating that high-priced bids continue to be concentrated in preferred locations within the city.

According to GGI Auction on February 14, the successful bid price ratio for apartment auctions in Seoul in the second week of February was 103.0%, down 4.9 percentage points from 107.9% the previous week. It is analyzed that the overall average was pulled down as older complexes and stand-alone apartment complexes in the Gangseo-gu area showed weakness.

A view of downtown apartments from Namsan, Seoul. Yonhap News

On the other hand, the successful bid price ratios in Gangdong-gu and Seongdong-gu exceeded 120%, showing strong performance. In the case of Hansol Solpark River in Amsa-dong, Gangdong-gu, it was sold for 1.65 billion won, recording a successful bid price ratio of 129.9% and ranking first. The Oksu Samsung complex in Seongdong-gu was auctioned off for 2.167 billion won, ranking second with a successful bid price ratio of 123.8%. Each of these properties attracted 10 bidders.

The successful bid rate for apartment auctions in Seoul was 42.9%, plunging 23.8 percentage points from 66.7% the previous week. It is analyzed that, after a large number of properties in preferred locations were successfully auctioned last week, less-preferred properties remaining on the market failed to attract bids, dragging down the successful bid rate.

In Gyeonggi Province, the successful bid rate for apartments was 44.0%, up 3.9 percentage points from 40.1% the previous week. The successful bid price ratio was 89.8%, surging 8.6 percentage points from 81.2% a week earlier. In particular, high-priced bids continued to be concentrated in areas designated as land transaction permit zones. An Indukwon Daewoo apartment of around 30 pyeong in Pyeongchon-dong, Dongan-gu, Anyang-si attracted 48 bidders, recording the highest competition rate in the province. The successful bid price ratio for this property was 123.6%. In addition, properties in the Misa Riverside Famille complex in Hanam-si, Gyeonggi Province, and the Sanun Maeul complex in Bundang-gu, Seongnam-si, which are also within land transaction permit zones, recorded successful bid price ratios of 117.7% and 114.4%, respectively, pushing up the overall successful bid price ratio for Gyeonggi Province.

Experts predict that, for the time being, bidders will continue to flock to properties in preferred locations in the Seoul metropolitan area, while properties in outlying areas will repeatedly fail to attract successful bids.

Lee Juhyun, Senior Researcher at GGI Auction, said, "In Seoul, the sales market is currently heating up, and we are seeing a pattern in which the number of properties proceeding to auction is decreasing," adding, "In preferred complexes within major locations in Seoul, investors are aggressively buying, and we are likely to see properties being absorbed quickly by the market." He added, "By contrast, less-preferred complexes in outlying areas may continue to experience repeated failures at auction."