Last year it was a 'Lotto' reserved land, but this year even if put up for sale 'again', it doesn't sell

Jangwi 7 District Association Announces Second Sale of Reserved Land
Up to 150 Million KRW Lower Than Initial Notice
"Minimum Bid Price Lowered Following Decreased Market Price"
Increased Interest Rates Also Contribute to Higher Buyer Burden

Aerial view of Jangwi 7 District, Seongbuk-gu, Seoul / Photo by Jeongbi Saeop Jeongbo Mongttang

[Asia Economy Reporter Hwang Seoyul] Last year, reserved lots were considered a 'lottery' because they could be purchased at prices cheaper than market value, but this year, even after re-announcements, they are struggling to find buyers. This is due not only to the decline in housing prices, which diminishes the advantage of the minimum bid price, but also to the difficulty in finding buyers who can bear the burden of increased loan interest rates.

According to the National Public Procurement Service's Nara Market on the 14th, the Jangwi 7 District Housing Redevelopment Association issued a second sale announcement for reserved lots and put 7 units up for auction. In the initial sale announcement in January, 7 units were also listed, but none were sold, leading to this re-announcement. Jangwi 7 District, located in Jangwi-dong, Seongbuk-gu, Seoul, was redeveloped into 'Kkumui Sup I-Park' and received occupancy approval last July. The complex consists of a total of 19 buildings and 1,703 units.

The conditions for buyers improved in the second sale announcement compared to the initial one. The minimum bid price was lowered by 100 million to 150 million KRW depending on the unit size. For example, three units of 59㎡A were initially announced at 1 billion KRW but were lowered to 850 million KRW; one unit of 76㎡ was reduced from 1.15 billion KRW to 1.05 billion KRW. The 85A㎡ (2 units) and 111㎡ (1 unit) were also lowered by 150 million KRW to 1.15 billion KRW and 1.45 billion KRW, respectively.

The association explained that the minimum bid price was lowered due to the decline in apartment market prices. For instance, according to Naver Real Estate, the sale price for the same 84㎡A unit in the reserved lot announcement ranges from 1 billion to 1.1 billion KRW, and when expanding to the same housing type, prices vary widely from a minimum of 1 billion KRW to a maximum of 1.38 billion KRW. A representative from the association said, "We need to dispose of these quickly because the dissolution process of the association can only begin once the reserved lots are sold."

Other complexes are also re-announcing reserved lot sales, but the situation differs from last year when they were called 'lottery' opportunities. The Suwon 115-6 District (Hillstate Prugio Suwon) redevelopment association in Paldal-gu, Suwon-si, Gyeonggi Province, announced the sale of 13 reserved lots last month but only 2 units were sold. In the same month, the Taereung Hyundai Apartment (Taereung Harrington Place) reconstruction association in Gongneung-dong, Nowon-gu, Seoul, issued its 11th reserved lot announcement with 11 units up for auction, but none were sold.

In the case of Taereung Hyundai Apartment, similar to Jangwi 7 District, the minimum bid price was lowered by 47 million to 65 million KRW compared to the previous announcement, but it was still insufficient. The ongoing decline means it is difficult to gain a significant advantage over the asking prices of listed units. Moreover, the increased loan burden on buyers is also a negative factor. A representative from the association explained, "We receive many inquiries, but the biggest problem is that loan interest rates often exceed 5%, which is a major issue."

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