Metropolitan Area Apartment Auction Price-to-Appraisal Ratio Returns to 90%; Seoul Tops 100% for Second Straight Week

[Financial News] The price-to-appraisal ratio for apartment auctions in the Seoul metropolitan area returned to the 90% range after four weeks. In Seoul, winning bids exceeded appraised values for the second consecutive week, and high-priced winning bids continued in Gyeonggi Province. However, the winning-bid rate fell even as the number of properties put up for auction rose 51% from the previous week.
On the 16th, according to weekly auction trend data from GG Auction, a company specializing in court and public auction data, 376 apartments in the Seoul metropolitan area were put up for auction from the 12th to the 16th of this month, up about 51% from 249 the previous week. The increase is believed to reflect sale schedules postponed to this week because of two days of holidays last week.
The price-to-appraisal ratio rose 0.8 percentage points, from 89.8% the previous week to 90.6%. By contrast, the winning-bid rate fell 3.6 percentage points, from 42.2% to 38.6%. The average number of bidders also dropped by 0.7, from 6.0 to 5.3.
In Seoul’s apartment auction market, winning bids continued to exceed appraised values. This week’s price-to-appraisal ratio was 101.2%, down 0.4 percentage points from 101.6% the previous week, but it remained above 100% for the second consecutive week.
In particular, half of the apartments awarded in Seoul this week were first-time auction listings that had not previously failed to sell. The emergence of bidders offering more than the appraised value is believed to have sparked competition among buyers, particularly for some apartment complexes.
Forena Songpa in Geoyeo-dong, Songpa-gu, sold for 125.7% of its appraised value, recording the highest price-to-appraisal ratio among Seoul apartments this week. Hangang Hyundai in Jayang-dong, Gwangjin-gu, followed at 120.9%, and Gireum New Town in Gireum-dong, Seongbuk-gu, at 120.3%.
However, the winning-bid rate fell to 26.7%, down 1.0 percentage point from 27.7% the previous week. Although the share of all auction properties that actually sold declined, the average number of bidders rose by 0.4, from 5.4 to 5.8.
In Incheon, the price-to-appraisal ratio for apartments fell 1.3 percentage points to 80.3%, from 81.6% the previous week. Some apartment complexes fetched high prices, including The Sharp Songdo Marina Bay in Songdo-dong, Yeonsu-gu, which sold for 106.1% of its appraised value, but the overall average remained in the low 80% range.
In Bupyeong-gu and Michuhol-gu, among other areas, apartments that had failed to sell at auction several times were sold for 40% to 60% of their appraised values. The winning-bid rate rose 2.2 percentage points, from 24.3% to 26.5%, and the average number of bidders increased by 0.6, from 3.0 to 3.6.
Gyeonggi Province showed a different trend from Seoul and Incheon. The apartment price-to-appraisal ratio rose 3.0 percentage points, from 85.0% the previous week to 88.0%. Apartments sold for more than their appraised values even in non-regulated areas, including Namyangju, Gunpo and Gwonseon-gu in Suwon, driving up the average.
However, Gyeonggi Province’s winning-bid rate fell 1.5 percentage points, from 50.3% to 48.8%. The average number of bidders also decreased by 0.7, from 6.4 to 5.7. In other words, winning prices rose, but competition among bidders did not intensify overall.
[email protected] Choi A-young Reporter