Apgujeong Apartment Plunges 3.5 Billion Won... Will This Trigger Further Declines in Greater Gangnam?

[Anchor]

Transactions involving major Seoul reconstruction apartment complexes dropping by billions of won have continued recently.

This is reportedly due to a regulation that restricts selling homes once reconstruction gets underway. Reporter Jeon Hyeong-u investigates the matter.

[Reporter]

Shinhyundai Apartment in Apgujeong-dong, Gangnam-gu, Seoul.

The largest 183-square-meter unit was traded at 9.3 billion won early this month.

This price is down 3.5 billion won from its peak of 12.8 billion won in December of last year.

A 182-square-meter unit in Shinhyundai Phase 12, which fetched over 11 billion won three months ago, was also sold at a price lower by 2.45 billion won.

Such transactions with cuts of billions of won are continuing in prominent Gangnam reconstruction complexes, which is analyzed to be due to regulations prohibiting the sale of homes once reconstruction accelerates.

This complex is scheduled to hold a union general meeting this week and apply for project implementation plan approval early next month.

By law, apartment complexes designated as speculation-overheated districts are practically barred from selling homes, barring very few exceptions, after applying for project implementation plan approval.

[Park In-gu / Apgujeong Real Estate Agent: So, properties like that seem to have come out as urgent sales to sell in advance before the project implementation approval.]

Additionally, government tax reforms increasing the comprehensive real estate holding tax burden for ultra-high-priced homes, alongside heavier capital gains taxes upon selling, have simultaneously influenced the market.

[Apgujeong Apartment Union Member: Since the average age is over 60 and cash flow is low, the comprehensive real estate holding tax seems likely to rise by about three to four times.]

The tax burden also appears to be halting the upward trend of home prices in other parts of the Gangnam area.

Last week, apartment prices in Gangnam-gu fell by 0.31%, Seocho by 0.32%, and Songpa by 0.13%, respectively.

Conversely, overall Seoul apartment prices rose by 0.13%, contrasting with the upward trend seen in non-Gangnam areas such as Seongbuk and Seodaemun.

(Video reporting: Kim Hak-mo | Video editing: Jung Yong-hwa | Design: Park Cheon-woong)
※ Please note: This article was translated by AI and may contain errors.