International Law

Average Seoul Apartment Price Exceeds W500 million

Paging Doctor Housing Bubble! Is Dr. Bubble in the house?

Thanks to the Roh housing policy, the average price of 900 square-foot Seoul apartments (pitifully small, hardly large enough for Battlestar Galactica’s Rekha Sharma to lounge around in nude) now exceeds W500 million, less than two years after the price for similar apartments passed the W400 million level, the Maekyung Ilbo reports today:

30-pyong Seoul Apartments Pass W500 Million

The average price of a 30-pyong apartment in Seoul has surpassed W500,000,000.

According to real estate advisory firm Budongsan Bank on the 20th, the average price of an 85m² apartment has broken through the W500 million level to reach W511,800,000. It’s been only a year and 10 months since the price passed W400 million on June 4, 2006.

By district, Kangnam-gu and Seocho-gu were in first and second place with average prices of W1,477,100,000 and W983,970,000, respectively; other districts came in at W773,910,000 in Songpa-gu; W744,140,000 in Yongsan-gu; W629,580,000 in Kwangjin-gu; W531,600,000 in Chung-gu; W525,130,000 in Seongdong-gu; W521,670,000 in Mapo-gu. Nowon-gu, after its recent sharp spike in apartment prices, remains below the W500 million level at W429,330,000.

Here’s the original Korean text, if you’re interested:

?? 30?? ???, ?? 5? ??

?? 30?? ??? ?? ???? 5???? ????.

20? ??????? ?????? ??? ???? ???? 85m² ??? ?? ???? 5?118???? 5???? ????. 2006? 6? 4??? ??? ? 1?10?? ???.

????? ???? ???, ??? ? ???? 9?2112???? 5??? ?? ??? ? ?? ????? 4?3088??? ????.

???? ???? 10?4771??, ???? 9?8397???? 1?2?? ????. ?? ??? 7?7391??, ??? 7?4414??, ??? 6?2958??, ?? 5?3160??, ??? 5?2513??, ??? 5?2167?? ????. ???? ?? ??? ? ??? ????? 4?2933???? 5??? ????.

The foregoing reported prices are average prices across Seoul, pulled up quite a bit, as you can see, by extremely high average prices in the nouveau riche areas of Kangnam-gu and Seocho-gu, followed by up-and-coming Songpa-gu and Yongsan-gu. Elsewhere in the Maekyung Ilbo I stumbled across an article describing how the Myong-dong corner location where the Pascucci Coffee is located is Korea’s most expensive plot of commercial real estate at W200 million per square meter. Let’s take a look at the dizzying heights of Korea’s most expensive bubble residential neighborhoods:

The most expensive residential neighborhood is Dongbu Centreville apartments at 670 Daechi-dong. At W12,100,000 per square meter (W39,300,000 per pyong), it approaches the level of W40,000,000 per pyong, an increase of 15.2% over last year’s price (W10,500,000 per square meter).

The second most expensive residential neighborhood was i-Park at 87 Samsung-dong, priced at W11,800,000 per square meter (W38,940,000 per pyong), and Dogok Rexle Apartments at 527 Dogok-dong was third at W11,000,000 per square meter (W36,300,000 per pyong). These two were also up over last year—12.4% and 10.4%, respectively.

Tower Palace at 467 Dogok-dong, despite being valued at W19,700,000 per square meter (W65,010,000 per pyong), is an “officetel” (jusang bok-hap) building zoned for commercial use, and so is not included in the rankings of residential areas.

Recall that the original Maekyung piece concerned a hypothetical 30-pyong spread in Seoul—915 square feet, with two or usually three bedrooms. If we take those average prices, the Dongbu Centreville comes in at W1,179,000,000; i-Park at W1,168,200,000; Dogok Rexle at W1,089,000,000; and the Tower Palace an alluring W1,950,300,000. So cheap, let’s buy two.

And again, here is the original Korean language:

???? ??? ?? ?? ?? ??? 670 ?????????. m²? 1210??(3.3m²? 3993??)?? 3.3m²? 4000?? ?? ?? ????. ??? ????(m²? 1050??)?? 15.2%? ????. ??????? 5? ???? ?? ?? ???? ??? ????.

? ??? ?? ????? ??? 87 ????? m²? 1180??(3.3m²? 3894??)??? ??? 527 ????? ?? 1100??(3.3m²? 3630??)?? 3?? ????. ?? ??? ????? 12.4%, 10.4%?? ???.

???? ??? ??? 467 ?????? m²? 1970??(3.3m²? 6501??)???? ????? ??? ????? ???? ???? ???? ???.

Full post as published by Korea Law Blog on April 20, 2008 (boomark / email).