Numerous '99sil' Officetels... Regulations Fueling 'Tricky Sales'

Officetels Under 100 Units Exempt from Resale Restriction Regulations

'Shingil AK Prugio' Seokgyeong Perspective View

In the officetel market, there is a growing trend of supplying '99 units' to avoid resale restrictions. Critics argue that the government's expanding regulations to officetels to curb speculation are instead encouraging the industry's loophole sales.

According to the real estate industry on the 4th, most of the projects causing overheated subscription phenomena in the officetel market recently are small-scale supplies with fewer than 100 units. Representative examples are 'Singil AK Prugio' in Yeongdeungpo-gu, Seoul, and 'Hillstate Gwacheon Government Complex Station' in Gwacheon-si, Gyeonggi Province, which received subscription applications this week. 'Singil AK Prugio' consists of 96 units, and 'Hillstate Gwacheon Government Complex Station' has 89 units.

Many officetels supplied with exactly 99 units, just one unit short of 100, have also been released. In Seoul, 'The Next Mokdong' in Yangcheon-gu, 'Janghanpyeong Station Quantum View' and 'Eliat Gangdong' in Seongdong-gu, and in Incheon, 'Cheongna Suite Class' each had 99 units. 'La Porte Blanc Seohyeon' (95 units) in Bundang, Seongnam, 'Duryu Station Xi' (86 units) in Daegu, and 'Eluke Banpo' (84 units) in Seocho, Seoul, were also built on an 80-90 unit scale.

The reason why officetel sales with fewer than 100 units dominate is due to government regulations. According to the Enforcement Decree of the Building Sales Act, officetels with 100 or more units sold in speculative overheated districts or regulated areas are prohibited from resale until ownership transfer registration. However, this regulation can be avoided if there are fewer than 100 units. Since transactions are possible by paying only 10% of the contract amount, short-term speculative demand that resells immediately after winning with a premium is pouring in. The 'Hillstate Gwacheon Government Complex Station' supplied in Galhyeon-dong, Gwacheon-si, on the 2nd of this month, despite controversy over high prices, attracted about 124,500 applicants and recorded an average competition rate of 1,398 to 1, which the industry analyzes is due to speculative demand aiming for short-term profits.

'Hillstate Gwacheon Cheongsa Station' Perspective View

The start of the 'under 100 units officetel trend' was the government's June 17 real estate measures announced last year. It designated most areas in the metropolitan area, excluding Gimpo, Paju, Yeoncheon, and Dongducheon, as regulated areas. Previously, since January 25, 2018, the government had imposed resale restrictions on officetels with 100 or more units sold not only in speculative overheated districts but also in regulated areas.

A sales industry official said, "The level of competition completely changes depending on whether the phrase 'resale possible' is included in the sales advertisement," adding, "In a situation where all investment routes are blocked by various regulations, it is difficult to find an alternative attraction factor to 'resale possible.'"

Whether resale is possible can be a variable that determines the success of sales even with the same location and brand. The officetels of Pangyo Valley Xi (Complexes 1-3) sold earlier this year recorded an average competition rate of 232 to 1. The 3rd complex, with 62 units, avoided resale restrictions unlike the 1st (108 units) and 2nd (112 units) complexes, and its competition rate reached 834 to 1.

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