Raemian One Bailey sells for W145b below prior price as below-market deals spread across Gangnam

A string of apartment transactions in Seoul's three Gangnam-area districts — Gangnam-gu, Seocho-gu and Songpa-gu — have come in at 5 percent or more below the previous recorded price for the same unit type. Raemian One Bailey in Banpo-dong, Seocho-gu changed hands for 1.45 billion won ($1.08 million) less than the prior transaction, while a complex in Gaepo-dong, Gangnam-gu saw a deal more than 30 percent below the previous price.

Ham Young-jin, head of the real estate research lab at Woori Bank, analyzed apartment transactions reported in the three districts over the week of Oct. 29 through Wednesday using the Ministry of Land, Infrastructure and Transport's actual transaction price disclosure system. The analysis found 16 transactions in which the price for the same complex and same exclusive use area fell at least 5 percent from the prior deal. Songpa-gu recorded the most with eight, followed by Gangnam-gu with six and Seocho-gu with two.

The steepest price drop in absolute terms was at Raemian One Bailey in Banpo-dong, Seocho-gu. An 84-square-meter unit sold for 5.7 billion won on Oct. 14, down 1.45 billion won, or 20.3 percent, from the prior transaction price of 7.15 billion won. At Seocho Granzio in Seocho-dong, Seocho-gu, a 100-square-meter unit sold for 4.07 billion won on Oct. 22, falling 220 million won, or 5.1 percent, from the previous price of 4.29 billion won.

The sharpest percentage decline was at Sungwon Daechi 2 complex in Gaepo-dong, Gangnam-gu. A 49-square-meter unit sold for 1.4 billion won on Oct. 29, down 625 million won, or 30.9 percent, from the prior price of 2.025 billion won. A 33-square-meter unit in the same complex also fell 5 percent, from 1.495 billion won to 1.42 billion won.

Below-market deals also emerged in Dogok-dong, Gangnam-gu. An 84-square-meter unit at Hyundai Green 1 sold for 2.2 billion won on Oct. 9, down 250 million won, or 10.2 percent, from the prior price of 2.45 billion won. A 59-square-meter unit at Dogok Rexle similarly fell 240 million won, or 8.9 percent, from 2.69 billion won to 2.45 billion won. In Daechi-dong, a 97-square-meter unit at Daechi Samsung dropped 6.9 percent, from 3.6 billion won to 3.35 billion won.

In Songpa-gu, discounted transactions were also recorded at major large-scale complexes in the Jamsil area. A 76-square-meter unit at Jamsil Jugong 5 sold for 3.73 billion won on Oct. 21, down 330 million won, or 8.1 percent, from the prior price of 4.06 billion won. An 84-square-meter unit at Jamsil Els changed hands on Oct. 16 for 3.1 billion won, falling 200 million won, or 6.1 percent, from the previous price of 3.3 billion won.

Similar trends appeared at relatively lower-priced complexes. In Garak-dong, Songpa-gu, an 84-square-meter unit at Hansin 1 fell 7.5 percent from 1.73 billion won to 1.6 billion won, while an 84-square-meter unit at Olympic Family Town in Munjeong-dong dropped 5 percent from 2.69 billion won to 2.55 billion won. A 51-square-meter unit at Wirye 24 Danji Kkumenegreen in Jangji-dong also declined 7.7 percent, from 1.62 billion won to 1.5 billion won.

Of the 16 transactions tallied, three fell more than 10 percent below the prior price. Below-market deals appeared not only at flagship high-end complexes in the three Gangnam districts but also in smaller and mid-sized units and at complexes pursuing reconstruction. Tighter lending regulations have raised financing costs, and buyer fatigue over elevated prices has fueled a wait-and-see stance — conditions that may have prompted some sellers to lower their asking prices.

The tally covers transactions newly reported during the one-week period; actual contract dates range from late September through late October.

"Discounted transactions at major Gangnam complexes are appearing across different neighborhoods and housing types, not confined to any single area," Ham said. "However, it would be premature to conclude that the three Gangnam districts as a whole have turned to a downward trend based on a handful of below-market deals. What needs to be watched is whether lower-priced transactions repeat at the same complexes and whether the trend spreads to surrounding areas."