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Korean Job Discussion Forums
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Derrek
Joined: 15 Jan 2003
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 Posted: Sat Jan 22, 2005 1:14 am Post subject: |
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So you get a 25% increase in value in about 18 months?
I got about 10% increase per year where I was living in the states.
Not a bad investment.
Could you ever see property values go down around here? |
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JongnoGuru
Joined: 25 May 2004
Location: peeing on your doorstep
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| Posted: Sat Jan 22, 2005 2:16 am Post subject: |
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| Derrek wrote: |
So you get a 25% increase in value in about 18 months?
I got about 10% increase per year where I was living in the states.
Not a bad investment.
Could you ever see property values go down around here? |
As apartment prices in Gangnam, Seoul began to fall this year, the fluctuation rate in apartment prices in Gangbuk exceeded Gangnam for the first time in 12 years. Real estate information provider Real Estate 114 said that while the sale prices of apartments in the Gangnam area, Seoul fell by 0.64%, in the Gangbuk area they rose by 2.60%. Jeonse prices also fell by 4.20% in Gangnam, while in Gangbuk they fell by 1.86%.
http://www.kreic.com/e_pds/pds2_1_view.jsp?bbs_id=336&page=1 |
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Derrek
Joined: 15 Jan 2003
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| Posted: Sat Jan 22, 2005 4:51 pm Post subject: |
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Good info...
I wonder sometimes if these things have to hit a ceiling.
I often wonder Who in their right mind can afford buying an 800,000,000 won house, like one of my students parents has? I know some can, but I almost have to feel like the houses can't sell for their full value??
Then again, I am probably wrong.
All I know is that she said the price they paid was 400,000,000, but the value has doubled due to it's location. |
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JongnoGuru
Joined: 25 May 2004
Location: peeing on your doorstep
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| Posted: Sat Jan 22, 2005 6:01 pm Post subject: |
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| Derrek wrote: |
Good info...
I wonder sometimes if these things have to hit a ceiling. |
It's not exactly a ceiling (like you hit it and never, ever exceed it) but more a matter of price surges, followed by consolidation (supply catches up with demand) and then another surge.
In countries like Korea and Japan, where population growth no longer stokes demand like it once did, you get specific pockets and blips of demand generated by other factors: from rural to urban, from crappy old apartment to swanky new highrise, from Countrybumpkin-dong to Ain't_I_the_Shiznit!-dong, etc.
Because of these constant mini-trends and micro-shifts in the Korean population, you can find some extremely affordable and attractive homes in neighbhourhoods that have fallen out of vogue. While some areas will see a surge in prices, other areas will be stagnant or even decline. So, even though average home prices typically rise over time, there are always places that are incomparably more affordable if you can buck the trend and go against the herd. And, unlike many countries in the West, affordable housing in Korea doesn't mean unacceptably high street-crime rates or ghastly levels of public services.
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I often wonder Who in their right mind can afford buying an 800,000,000 won house, like one of my students parents has? ...
All I know is that she said the price they paid was 400,000,000, but the value has doubled due to it's location. |
Yep, that's the way it goes sometimes. In 2000, my accountant told me about a house (not apartment) in a back alley of Nonhyun-dong, Kangnam-gu, Seoul, that was up for auction (2nd round) that he thought I might be able to buy for around 650~700 million won. At the time, I was expanding my business, didn't need the distraction, a big wad was already tied up in a house that I was buying for my own residence, and we just had far more money going out than was coming in.
I went down and we looked at the house anyway, but the timing was all wrong. I just told myself: "You're here to build a business, not to speculate in real estate." Well I'll be damned if that same property, unimproved, didn't sell for 2.3 billion won in 2003. Tidy little profit for someone with a couple years to burn, no? You'd've effectively made nearly 1.5 million won/day, three years running, for doing eff-all. |
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