9-Pyeong Apartment Worth 1.3 Billion Won... Apartment Alternatives Surpassing Apartments

Apartment Prices Suppressed by Pre-sale Price Review System
Urban Lifestyle Housing and Officetels Soar High High

The construction site of 'Raemian One Bailey,' the first private reconstruction apartment subject to the reintroduced pre-sale price ceiling system in July last year

The government's control over apartment sale prices is causing side effects by driving up the prices of alternative housing products.

According to the Korea Real Estate Board's subscription website on the 19th, the sale price of the 30㎡ (exclusive area) urban lifestyle housing 'Wileben646' supplied in Samseong-dong, Gangnam-gu, Seoul, was set at about 1.248 billion KRW. The sale price for 31㎡ is about 1.34 billion KRW, and for 42㎡, it is 1.595 billion KRW. All exceed 100 million KRW per 3.3㎡ by a wide margin.

This price surpasses that of 'Raemian One Bailey' in Banpo-dong, Seocho-gu, which was considered the biggest reconstruction project in this year's sale market. The supply area-based price of Raemian One Bailey was 56.69 million KRW per 3.3㎡, about half of the surrounding market price, which exceeds 100 million KRW. Even based on exclusive area, the sale price for 59㎡ was only around 78.9 million KRW per 3.3㎡.

The price reversal phenomenon is no exception for officetels. For example, the 84㎡ officetel 'Dongtan Station Dietre Prestige,' which held its subscription in June, was priced at 916.6 million KRW. This is more than twice the apartment sale price for the same area in the same complex, which ranged from 440.34 million to 488.67 million KRW last month.

The reason officetel and urban lifestyle housing prices exceed those of apartments is due to government price controls such as the sale price ceiling system and the Korea Housing & Urban Guarantee Corporation (HUG)'s high price review. Urban lifestyle housing, introduced in 2009 to meet the housing demand of 1-2 person households in urban areas, is a small-scale housing type. It is free from various regulations such as parking and noise standards and is not subject to the sale price ceiling system or HUG's high price review.

Recently, construction companies increasing the supply of officetels, urban lifestyle housing, and residential hotel facilities is also interpreted as a desperate measure to avoid regulations. Demand is also concentrated because these products do not require subscription savings accounts, are not subject to re-winning restrictions or mandatory residence obligations, and have lower entry barriers.

Apartments subject to the sale price ceiling system have become a 'lottery.' On the 11th, a total of 248,983 people applied for the non-priority subscription of DH Xi Gaepo in Irwon-dong, Gangnam-gu, in one day. The subscription frenzy occurred as the price difference from the market price is expected to be at least 1.5 billion KRW due to the application of the sale price ceiling system.

An industry insider pointed out, "The government's price control has ultimately failed to curb housing prices, brought enormous market price gains to a small number of winners, and only caused a balloon effect by raising the sale prices of non-apartment products."

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