Mortgage clampdown fuels office-tel auction boom, record number of successful bids

[The Financial News] As lending regulations on apartment purchases have tightened, demand for office-tels in the auction market is surging. In the first quarter of this year, the number of office-tel units successfully sold at auction reached an all-time high. Observers explain that oversight has also been strengthened on business loans that were quietly being used as de facto apartment purchase funds amid strict mortgage regulations, drawing even more attention to office-tels.
According to the Court Auction Information Service on the 15th, 1,388 office-tel units were sold at auction between January and March this year. This is a 25.3% increase from 1,108 units in the same period last year. Until now, last year was the only time the figure for that period exceeded 1,000 units, and this year’s tally has already surpassed it again just one year later.
Even on an annual basis, there have only been two years when the number of successful office-tel auction sales topped 1,300 units: 1,366 units in 2022 and 1,336 units in 2023.
By region, Incheon recorded the highest number of successful sales this year with 476 units, followed by Busan Metropolitan City with 216 and the southern Seoul area with 197. All three are areas with strong demand for actual residence.
The main reason office-tel demand in the auction market is hitting record levels is that financing is easier to obtain than for apartments. An auction industry official said, "Because of the government’s tough regulatory policies, banks have become reluctant to extend mortgage loans for apartments," adding, "With loans to buy apartments effectively blocked, attention is shifting to office-tels, which are not subject to the same regulations."
In fact, on March 21, President Lee Jae-myung used a social networking service (SNS) to urge voluntary repayment of loans, targeting cases where personal business loans were being diverted to home purchases and other unauthorized uses. Earlier, on June 27 last year, the government also announced limits on mortgage loans for apartments in regulated areas of the Seoul Capital Area: up to 600 million won for homes priced at 1.5 billion won or less, 400 million won for those between 1.5 billion and 2.5 billion won, and 200 million won for properties over 2.5 billion won. These rules remain in effect. By contrast, loans for purchasing office-tels are still relatively easy to secure. Currently, for residential office-tels, borrowers can obtain financing for roughly 60–70% of the purchase price.
The number of office-tels coming onto the auction block has also increased sharply. In the first quarter of this year, there were 6,084 office-tel auction listings, up 36.6% from 4,455 in the same period a year earlier and 77.7% higher than the 3,424 recorded in 2024.
Another auction industry official noted, "The office-tel auction market is already heating up to the point that this year’s figures are surpassing those of the past several years," and predicted, "People who missed their chance to buy a home during the apartment price surge are turning their attention to office-tels, so demand is likely to grow further for the time being."



kjh0109@fnnews.com Kwon Jun-ho Reporter