Unprecedented Bid Shocks Property Market
An apartment in Yeongdeungpo-gu, Seoul, has been sold at auction for an astonishing 17.296 billion won, a figure nearly ten times its appraised value. This astronomical winning bid has sparked speculation of a significant mistake occurring during the bidding process.
Details of the Irregular Auction
According to information from the court auction system on the 16th, a unit within the Yeongdeungpo Arte Jai apartment complex, located in Dorim-dong, Yeongdeungpo-gu, was reportedly sold at this extraordinary price during a real estate auction held on the 11th at the Seoul Southern District Court.
The winning bid translates to approximately 400 million won per pyeong (approximately 3.3 square meters), a staggering amount compared to the property’s appraised value of 1.88 billion won. The property had been put up for auction multiple times, with the minimum bid price decreasing by 20% from the appraised value to 1.504 billion won in its latest offering.
Analysis Points to Bidding Error
Industry professionals suggest that such unusual bid amounts are not unheard of in auction history, and this instance likely points to an error during the bidding process. It is theorized that a bidder may have inadvertently added an extra zero when entering their bid, intending to offer 1.7296 billion won instead of the final 17.296 billion won.
Precedent for High Bids and Potential Errors
This incident follows similar occurrences in the Seoul real estate market. Previously, an apartment in Guro-gu, Seoul, was sold at auction for 6.67 billion won, approximately 8.8 times its appraised value of around 700 million won. In another case, a small, 10-pyeong unit in Yangcheon-gu, Seoul, was auctioned for 1.9517 billion won.
In cases where a winning bidder withdraws their purchase, they forfeit their bid deposit, which is typically 10% of the minimum bid price. For the Yeongdeungpo unit in question, this deposit would amount to 150.4 million won.
