Last month, the winning bid rate for apartment auctions in Seoul, which is the ratio of the winning bid to the appraised value, reached the highest level in 2 years and 9 months. With the expansion of the land transaction permit system in the Gangnam area (Gangnam, Seocho, Songpa) and Yongsan, investors flocked to the auction market, which is not subject to regulation.
According to the auction data company GGI Auction, the number of nationwide apartment auction proceedings last month recorded 2,888 cases, a decrease of about 15% compared to the previous month (3,379 cases).
The winning bid rate, which is the ratio of the number of winning bids to the number of proceedings, fell by 2.7 percentage points to 39.9%, compared to February (42.6%). The winning bid rate (85.1%) showed a similar trend to February (84.7%). The average number of bidders increased to 8.3, up 1.1 from the previous month (7.2), marking an increase for three consecutive months.
The number of auction proceedings for apartments in Seoul also decreased by about 32% last month to 172, compared to February (253). After the lifting of the land transaction permit zone in February, apartment prices in some areas, such as Jamsil, Samsung, Daechi, and Cheongdam, soared, leading to an increase in cases of debt repayment or postponement of auctions, which reduced the number of auction proceedings. The winning rate fell by 0.8 percentage points to 41.9% compared to February (42.7%).
The winning bid rate recorded 97.5%, an increase of 5.7 percentage points from the previous month. This is the highest level in 2 years and 9 months since June 2022 (110.0%). Analysts interpret this as a result of increased investment demand in the auction market, which is not subject to regulation, following the expansion of the land transaction permit system.
The average number of bidders also reached 10.6, the highest in three years since February 2021 (11.7). The winning rate slightly decreased to 41.9% compared to the previous month.