Excessive Sale Price Regulations... 'Dunchon Jugong' Ultimately Plunged into Internal Conflict

HUG's Proposed General Sale Price 29.1 Million KRW per 3.3㎡... Rumor Confirmed
Association Strongly Denies Rumors Until Now... Internal Conflict Intensifies with Efforts to Dismiss Association Head

[Asia Economy Reporter Donghyun Choi] Ultimately, the excessive price regulation by the Housing and Urban Guarantee Corporation (HUG) has pushed the reconstruction project of Dunchon-dong Jugong Apartments in Gangdong-gu, known as the largest housing project in Seoul this year, into crisis. This is because the unreasonable price regulation, which did not consider the location and complex characteristics, even triggered internal conflicts within the association.

According to the maintenance industry on the 8th, the Dunchon-dong reconstruction association will hold an emergency delegates' meeting in the afternoon. The background of this meeting is the general sale price proposed by HUG. The materials related to the delegates' meeting disclosed to the association members include the 'Management Disposition Plan Amendment.' It states that the average general sale price per 3.3㎡ is confirmed at 29.1 million KRW, and the estimated general sale revenue through this is 3.576 trillion KRW. The rumor circulating among Dunchon Jugong association members over the past week about the 29.1 million KRW per 3.3㎡ sale price has been confirmed as true.

The general sale price proposed by HUG is not legally mandatory to follow. However, under current law, general sales are impossible without HUG's sale guarantee, so the association has no choice but to accept it unconditionally or postpone the sale. In effect, the government is controlling the sale prices of private projects through the public corporation HUG.

The association plans to hold an extraordinary general meeting in early July to make a final decision between pre-sale and post-sale, but internal strife is intensifying as some members are demanding the dismissal of the association head. Voices calling for the dismissal of the association head are growing within the association. Some members are exchanging information through social networking services (SNS) and pushing for agreement on the dismissal motion.

The strong backlash from association members stems from the association's persistent denial of the rumor that the general sale price was set at 29.1 million KRW per 3.3㎡. In fact, the association stated in a notice on the 6th that "the sale price by the Housing and Urban Guarantee Corporation (HUG) has not been finalized and negotiations are ongoing." This contradicts HUG's consistent statement that "the sale price is a matter of notification, not negotiation." One member criticized, "They said 29.1 million KRW was correct at one time, then denied it again, consistently lying about facts that would soon be revealed."

However, the association still maintains that there is room for price changes. According to HUG's criteria for high-priced projects, the average regional sale price per square meter of private apartments is applied as a variable, and since this price is announced on the 15th of each month, there is a possibility of price fluctuation. Even considering this, the gap with the previously desired price of 35.5 million KRW per 3.3㎡ by the association is expected to be large. This level of sale price is similar to the 27.45 million KRW per 3.3㎡ sale price of the Dongdaemun-gu Yongdu 6 District redevelopment (Raemian Elinity), where the official land price is about half.

The association plans to hold an extraordinary general meeting around July to make a final decision on whether to proceed with the pre-sale at 29.1 million KRW or reject it and proceed with post-sale. Depending on the agenda supported by a majority attendance and majority approval at the meeting, the future sale method of Dunchon Jugong is expected to change.

This content was produced with the assistance of AI translation services.