High-priced apartments on second-hand markets raise financial safety concerns

Apartment complex construction sites are seen from Mount Nam in Seoul, Sunday. Yonhap

High-priced apartments are being increasingly listed for sale on online second-hand markets, prompting concerns that direct billion-won transactions, not brokered by professionals, may lead to disputes or even crimes, industry officials said Sunday.

More than 10 apartments, each priced at 4 billion won ($2.71 million) or more, were listed, Sunday, on Danggeun Market, the country’s largest mobile platform for peer-to-peer sales of used goods.

Many of the listings are in Seoul’s affluent neighborhood of Gangnam, with the cheapest being Raemian Prestige in Banpo-dong at 4.35 billion won.

Other notable listings in Banpo-dong include Raemian One Bailey at 10 billion won, Raemian One Pentas at 10 billion won, and the most expensive among them, Acro River Park, at 11.5 billion won.

“The rise of direct-deal housing transactions should not be seen as a passing curiosity, but as a growing trend that deserves serious attention among digitally savvy younger Koreans,” said Kwon Dae-jung, a real estate professor at Hansung University.

A real estate broker, speaking on condition of anonymity, shared a similar view, noting that many buyers of these high-priced properties are in their 30s and 40s, familiar with mobile platforms and accumulating wealth faster than their peers.

He said direct deals may gain ground as they save commission fess, which can be up to 0.5 percent of the traded amount of the housing properties.

Under the circumstances, other experts warned that the trend carries “serious downsides,” as properties traded without licensed brokers expose buyers to significant risks — including irrevocable errors and potential criminal actions.

“In uncertain times, standardized procedures are more important than ever,” Kim said, adding “risks increase proportionally with the value of the property.”

Kim Je-kyung, chief consultant at real estate agency Tumi, said, “Transactions of expensive apartments can result in losses that are very difficult to recover if problems arise, especially those involving forged documents, identity theft or fraud.”

He added that criminals often “possess extensive knowledge of real estate and operate several steps ahead of victims,” making it difficult for nonexperts to detect intentional document irregularities.

A wealth management manager, who spoke on condition of anonymity, said buyers should recognize that real estate acquisitions are “not just simple purchases, but a key part of their overall asset portfolio.

"Seen from that perspective, brokerage commissions aren’t just extra costs,” the expert said. “It’s often far more beneficial to have professionals review ownership, tax and financing matters than to save a small amount through direct trading.”

Meanwhile, some industry officials said that it is unclear whether most listings for high-priced apartments actually lead to completed direct transactions, arguing that many posts are uploaded simply for exposure or advertising purposes.