Buyers are flowing into the auction market in Dongtan, Hwaseong, where the semiconductor boom and the balloon effect from nonregulated areas are taking hold. With few listings and prices rising fast, demand to purchase through auctions is also concentrating on dwellings.
According to GGAuction, a court auction specialist, the apartment auction winning-bid ratio in Dongtan-gu, Hwaseong—winning price as a share of appraised value—from the 1st to the 12th averaged 109.2% as of on the 14th. The average winning-bid ratio in the Dongtan area was 93.0% in January this year.
A winning-bid ratio over 100% means the property sold for more than its appraised value.
At the bid held on the 8th, the exclusive 73 square meters at Dongtan Station Bando Ubora I'Park in Dongtan-gu, Hwaseong, drew 12 bids and was sold for 1.329998 billion won. The winning-bid ratio was 123.1% compared with the 1.08 billion won appraisal. The exclusive 102 square meters at Dongtan Station Lotte Castle Albatross in Cheonggye-dong, Dongtan-gu, drew 18 competing bids at the bid held on the 12th and was sold for 1.095999 billion won. That is 119.8% of the 915 million won appraisal.
Seven of eight apartment auction cases put up for auction this month were sold, posting a winning rate of 87.5%. The winning rate is the number of successful bids as a share of the number of auctions held. The winning rate for auctions in the Dongtan area was 45.5% in January this year, but climbed to 81.8% last month and continues to rise this month.
The number of auction bidders also increased from an average of 7.56 last month to 12.43 in June.
Because the appraisals for items currently up for auction were conducted before sale prices surged, even a high winning bid remains cheaper than market prices, drawing demand to auctions.
Dongtan is a residential area close to major semiconductor business sites such as Samsung Electronics, and buying demand has been concentrating since large performance bonuses at semiconductor corporations were finalized. In addition, because it is not a regulated area (adjusted area or speculative overheat district), the burden is lower in terms of financing or actual residence, and home prices are climbing steeply. According to the Korea Real Estate Board (REB), as of on the 8th, the weekly apartment price increase rate in Dongtan-gu was 1.98%, the highest in the country.
Lee Joo-hyun, a senior expert at GGAuction, said, "As the rise in apartment prices spreads to non-Gangnam areas, auction demand in these areas is increasing and the trend of higher winning-bid ratios is notable."