Seoul Auction Market Also Follows Sale Prices... Seocho Up, Nowon and Gangbuk Down

Nowon and Gangbuk Districts See Auction Indicators Fall Simultaneously
Prices Rose Last Year Due to All-In Buying
But Recent Sale Prices Dropped, Lowering Auction Popularity
Meanwhile, Seocho District's Auction Popularity Increased Compared to Last Year
Last Month, It Was the Only Area Without Price Decline

[Asia Economy Reporter Hwang Seoyul] The atmosphere in Seoul's real estate sales market is also affecting the auction market. Nowon and Gangbuk-gu, where sales prices rose sharply due to last year's aggressive borrowing-driven buying spree but have recently shown a downward trend, are also losing popularity in the auction market. On the other hand, Seocho-gu, the only one among Seoul's 25 autonomous districts to see an increase in sales prices compared to the previous month last month, showed improved auction indicators compared to last year.

According to auction information company Gigi Auction on the 31st, the average sales rate of apartments in Nowon-gu from January to August this year (as of the previous day) was 40.60%, down 25.03 percentage points from 65.63% in the same period last year. The average sales price rate (99.54% → 78.06%) and the total number of bidders during this period (164 → 60) also decreased compared to the same period last year.

Gangbuk-gu, which led the apartment price increase along with Nowon-gu last year, also could not avoid a decline in auction indicators. The average sales rate in Gangbuk-gu during the same period this year was 47.61%. The average sales rate during the same period last year was 100%, with every auctioned property being sold. The sales price rate also dropped 19.44 percentage points from 96.30% last year to 76.86%, and the total number of bidders decreased from 51 to 43.

These two areas saw a rapid rise in sales prices last year as aggressive borrowing buyers flocked in, but have entered a decline phase this year. According to the Korea Real Estate Board, the average sales prices in January last year were 490.83 million KRW and 518.28 million KRW for Nowon-gu and Gangbuk-gu respectively, but with the borrowing-driven buying spree, prices rose to 723.91 million KRW and 702.79 million KRW by December of the same year. However, since then, prices have declined, and last month, Nowon-gu was at 714.74 million KRW and Gangbuk-gu at 695.12 million KRW, down 9.16 million KRW and 7.68 million KRW from their peaks. In fact, the 'Sanggye Jugong 9 Complex' (exclusive area 79.07㎡) in Sanggye-dong, Nowon-gu, had a real transaction price of 940 million KRW as of October last year, but last month it dropped to 839 million KRW, falling over 100 million KRW.

On the other hand, Seocho-gu, which has maintained an upward trend despite the overall decline in Seoul's sales prices, is also popular in the auction market. Seocho-gu's sales rate from January to August this year was 60.84%, an increase of 21.25 percentage points compared to 39.59% in the same period last year. The average sales price rate rose from 56.59% last year to 79.68%, and the total number of bidders increased from 30 to 79. According to the Korea Real Estate Board's July apartment sales price index, Seocho-gu was the only district among the 25 autonomous districts to see an increase in the sales price index compared to the previous month (+0.08%). Seocho-gu's sales prices have risen every month this year except for February (+0.00%), which was flat, despite the real estate market downturn.

Except for Seocho-gu, the other two Gangnam districts are also showing a decline in auction popularity along with falling sales prices. Songpa-gu's average sales rate decreased from 69.38% last year to 53.75%, and the sales price rate (96.15% → 81.34%) and total number of bidders (178 → 72) also dropped. Gangnam-gu also showed declines in all auction indicators, including sales rate (62.50% → 45.18%), sales price rate (93.63% → 64.98%), and total number of bidders (87 → 82).

Senior researcher Lee Juhyun of Gigi Auction said, "Nowon and Gangbuk-gu were heavily affected by loans and saw a decrease in transaction volume, causing asking prices to fall, whereas Seocho-gu was less affected by loans and also benefited from the preference for well-located properties," adding, "It seems that the auction market was also greatly influenced by the atmosphere in the sales market."

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