In Seoul's Gangnam and Seocho districts, "fire sales" are appearing at prices about 8% to 15% below their peaks, centered on redevelopment and high-priced apartments.
According to the real estate industry on the 8th, a 120㎡ (43-pyeong) unit at "Dogok Rexle" in Dogok-dong, Gangnam District, Seoul, was contracted on the 3rd for 3.8 billion won. That is about 15.5% lower than the record high of 4.5 billion won in Oct. last year. Across the street, a 121㎡ (44-pyeong), 18th-floor unit at "Daechi Lotte Castle Levene" in Daechi-dong is on the market as a fire sale for 3.7 billion won. Compared with the record transaction price of 4.055 billion won in Oct. last year, it is about 8.7% cheaper.
A, who runs a certified real estate agency in Gangnam, said, "If listings at least 10% cheaper than the previous high come out, mainly in large complexes near subway stations, a transaction happens immediately," adding, "I understand that the 120㎡B unit at Dogok Rexle transacted this month was contracted for sale just one day after it came out as a fire sale."
The situation is not much different in Seocho as well. A 84㎡ (33-pyeong) unit at "ACRO River Park" in Banpo-dong is currently on the market as a fire sale for 5 billion won, which is 10.7% lower than the record high of 5.6 billion won in Sep. last year. A 84㎡ (33-pyeong) unit at "Maple Xi" in Jamwon-dong also came out as a fire sale for 4.95 billion won, down 12.4% from the record high of 5.65 billion won in Nov. last year.
B, a staffer at a certified real estate agency in Seocho District, said, "In January to February this year, apartment seekers only asked about prices or just viewed homes, and deals rarely led to an actual transaction," but added, "From this month, both sellers and buyers have become pressed for time, so if the price is reasonably adjusted, they try to transact right away, and fire sales are being transacted immediately."
Real estate experts predicted that once fire-sale listings offered cheaply by multiple-home owners are absorbed in March to April, the number of listings in the Gangnam-area apartment market will plunge and transaction volume will fall together.
Nam Hyeok-u, a real estate researcher at Woori Bank, said, "Looking at the recent fire-sale listings driving apartment transactions in Seoul, the higher the price or the more it is a redevelopment apartment in Gangnam, the larger the price adjustment," adding, "In some parts of Gangnam, there are active purchase inquiries for fire sales, which means there is that much pent-up demand."
C, a real estate expert who requested anonymity, said, "Once the transactions centered on listings from multiple-home owners wrap up in March to April, full-fledged listing lock-up and a transaction cliff are likely to appear simultaneously from May," adding, "If buying momentum returns to the market in the second half of this year, there is a high possibility that a small number of transactions will be made at higher prices."