May Seoul Apartment Winning Bid Rate Hits Lowest in Over 6 Years... Nationwide Auction Indicators Also Decline

Gigi Auction 'May 2022 Auction Trend Report'

Number of Seoul Apartment Auction Cases, Winning Bid Rate, and Auction Success Rate / Data=ZigZag Auction

[Asia Economy Reporter Hwang Seoyul] The apartment auction success rate in Seoul in May recorded in the mid-30% range, marking the lowest level in over six years. This is interpreted as a result of inventory backlog and price decline in the sales market, along with consecutive base interest rate hikes, which have weakened buying demand. Nationwide apartment auction indicators also declined across the board, showing a sluggish auction market atmosphere.

According to the 'May 2022 Auction Trend Report' released by Gigi Auction on the 9th, the apartment auction success rate in Seoul in May was 35.6%, down 19.7 percentage points from the previous month (55.3%). The auction price ratio recorded 96.8%, down 8.3 percentage points from the previous month (105.1%), and the average number of bidders was 3.8, the lowest this year. Gigi Auction analyzed that this was due to the inventory backlog and price decline in the sales market following the temporary exclusion of capital gains tax surcharges implemented on the 10th of last month, combined with consecutive base interest rate hikes that weakened buying demand.

Number of Apartment Auctions Nationwide and Winning Bid Rate / Data provided by Gigi Auction

Nationwide, apartment auction indicators all declined. The number of apartment auctions nationwide was 1,586, of which 679 were successful. The success rate was 42.8%, down 6.4 percentage points from the previous month (49.2%), and the auction price ratio also fell 3.6 percentage points from the previous month (97.9%) to 94.3%. These are the lowest success rate and auction price ratio so far this year. The average number of bidders also decreased by 0.8 from the previous month (8.0) to 7.2.

Apartment auction indicators in Gyeonggi Province also declined across the board. The success rate slightly dropped to 54.6% from 55.3% the previous month, and the auction price ratio fell 6.9 percentage points to 93.7% from 100.6% the previous month. In Incheon, the success rate was similar to the previous month (42.6% vs. 42.3%), but the auction price ratio dropped 11.6 percentage points from 108.4% to 96.8%.

Among the five major metropolitan cities in the provinces, only Busan's apartment auction price ratio rose. Busan's apartment auction price ratio was 97.3%, up 5.7 percentage points from 91.6% the previous month, marking the highest level this year. The region with the largest decline was Daegu, which recorded 83.0%, down 8.9 percentage points from 91.9% the previous month. Following that, Daejeon (85.5%) fell 6.3 percentage points, Gwangju (97.0%) dropped 2.0 percentage points, and Ulsan (96.6%) declined 0.9 percentage points compared to the previous month.

Among the eight provinces, Jeonnam region rose sharply for two consecutive months. Jeonnam's apartment auction price ratio was 106.1%, up 11.9 percentage points from 94.2% the previous month, surpassing 100% for the first time since March 2012. Auction price ratios in Gangwon (99.3%) and Jeju (102.5%) also showed strength, rising 2.1 percentage points and 1.2 percentage points respectively compared to the previous month. Gyeongbuk (96.8%) and Chungbuk (90.9%) also slightly increased from the previous month. Chungnam (91.2%), Jeonbuk (95.2%), and Gyeongnam (92.4%) declined compared to the previous month.

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