Analysis of Noryangjin 'Hidden Gem' 2.1 Billion Won Small Building Investment Strategy Revealed (ft. Noryangjin New Town, Near Elementary School, Development Boost)
Noryangjin, Dongjak-gu, one of the representative areas in southwestern Seoul, is a place where regional value is being rapidly re-evaluated as the Noryangjin New Town development project is in full swing. As it is expected to transform from its traditional hagwon (academy) district image into a modern residential and commercial complex, it is attracting the attention of many investors. News of a small building located near Noryangjin Elementary School in this area being transacted for 2.1 billion Won clearly shows the potential for investment in the Noryangjin area to many real estate investors. Let's conduct an in-depth analysis of this investment case, which is expected to directly or indirectly benefit from the Noryangjin New Town development.
Dongjak-gu Noryangjin-dong 237-17, Transacted for 2.1 Billion Won
The building we will examine is located at Noryangjin-dong, 237-17 in Dongjak-gu, and it is a small building whose sale was completed for 2.1 billion Won in February 2025.
Key Features and Location Analysis of the Transacted Building:
- Noryangjin New Town Development Beneficiary Area: The Noryangjin New Town development project is a core boost that has the strongest impact on real estate value appreciation in the Noryangjin area. The aging residential and commercial environment will be modernized, and large-scale residential and commercial facilities will be built, significantly increasing the status of the area. This building is located in an area adjacent to the Noryangjin New Town zone, where direct or indirect benefits from the development are expected.
- Near Elementary School: Located near an elementary school, it is a location that stably secures rental demand for education-related facilities such as academies and study cafes. This is an important factor that allows for stable rental income. Particularly, Noryangjin has a traditional reputation as a hagwon district, making this demand even stronger.
- Near Noryangjin Station: Located within walking distance of Noryangjin Station, a transfer station for Subway Lines 1 and 9, providing excellent transportation accessibility. It offers excellent access to major downtown areas and Gangnam in Seoul, which is advantageous for attracting tenants for commercial spaces and offices within the building and contributes to securing abundant foot traffic.
- Second Class General Residential Zone: This building is located in a 'Second Class General Residential Zone'. This is an area aimed at creating a pleasant environment primarily with low- and mid-rise residential buildings. However, combined with the Noryangjin New Town development boost and its location near Noryangjin Station, it has the potential for diverse uses such as commercial spaces. It appears to have been constructed efficiently utilizing the building coverage ratio and floor area ratio (land area 39.63 pyeong, total floor area 53.80 pyeong, B1F to 2F).
- Investment in the 2 Billion Won Range: The sale price of 2.1 billion Won can be assessed as a reasonable level considering its location near the Noryangjin New Town development boost area, near an elementary school, and near Noryangjin Station. It was an attractive investment opportunity to secure a building near a core development area in Seoul for a relatively manageable amount in the low 2 billion Won range.
- Fronting a 6m Road: It fronts a 6m road, providing good vehicle and pedestrian access. While not a main road, it is located on a path used by residents and visitors to surrounding residential and educational facilities, ensuring a certain level of exposure to foot traffic.
- Building Status: It is a B1F to 2F building, completed on August 14, 1984. It is an aging building over 40 years old. This is an investment case focused on future value appreciation utilizing the Noryangjin New Town development boost, the location near an elementary school, and the locational advantages near Noryangjin Station, rather than the building's current condition.
Noryangjin New Town Development Boost, Expectation for 'Complete Transformation' Amplified
The Noryangjin New Town development project is a core boost that has the strongest impact on real estate value appreciation in the Noryangjin area.
- Improvement of Residential Environment: As aging residential areas are redeveloped into large apartment complexes, etc., the overall residential environment of the area will be significantly improved.
- Expansion of Commercial and Office Facilities: As commercial and office facilities are built within the New Town, new commercial districts will be formed and foot traffic will increase, revitalizing the local economy.
- Enhancement of Regional Status: Through New Town development, the urban landscape and functions of the Noryangjin area will be improved and upgraded, further strengthening the area's status as a major hub in southwestern Seoul.
- Driving Land Price Increase: These large-scale development boosts will continuously drive land price increases in the Noryangjin area, and this building, adjacent to the Noryangjin New Town zone, can receive direct and indirect benefits from the development.
The Power of Location Near Elementary School and Noryangjin Station
Being near an elementary school and near Noryangjin Station are important investment appeals of this building.
- Stable Rental Demand: Due to its location near an elementary school, there is steady and stable rental demand for education-related facilities (academies, study cafes, etc.). Noryangjin has a traditional reputation as a hagwon district, making this demand even stronger.
- Abundant Foot Traffic: Foot traffic from Noryangjin Station users, students and parents from nearby schools, and new residents moving in after the New Town development will be very abundant, which is advantageous for securing potential customers for commercial facilities.
- Excellent Transportation Accessibility: Excellent access to major downtown areas in Seoul is provided through the transfer at Noryangjin Station, which is advantageous for attracting tenants for commercial spaces and offices.
Land Price Relative to Official Standard Price, Relatively Reasonable Investment Judgment
The land price of this building, transacted at approximately 52.99 million Won per pyeong, is about 3.21 times the official standard land price (공시지가) of approximately 16.51 million Won per pyeong.
- Difference between Market Price and Official Standard Price: It is common for actual transaction prices to be higher than the official standard price. However, a ratio of 3.21 suggests that it reflects the locational strengths of the Noryangjin New Town development boost, its location near an elementary school, and its location near Noryangjin Station, as well as the potential for future value appreciation.
- Reasonable Investment Judgment: While a high ratio relative to the official standard price might feel expensive, considering the strong future value appreciation driver of the Noryangjin New Town development boost, the stable rental demand near the elementary school, and the location near Noryangjin Station, it can be assessed as a sufficiently reasonable investment from the investor's perspective. It was a 'cost-effective' investment opportunity to discover a 'hidden gem'.
Future Investment Strategy and Precautions
Investing in a small building near Noryangjin Elementary School is an attractive investment property that can expect future value appreciation based on the Noryangjin New Town development boost and its location near an elementary school. The advantage is securing a building near a core development area in Noryangjin for a reasonable price of 2.1 billion Won.
However, the following points should be carefully considered during investment:
- Building Age and Utilization Plan: The building was completed in 1984 and is aging. Future needs for repair or remodeling/new construction may arise due to building age. A thorough diagnosis of the building's condition and consideration of future utilization plans (remodeling, new construction, change of use, etc.) are necessary.
- Changes in Noryangjin Commercial Area: Changes in the Noryangjin commercial area, particularly the hagwon district commercial area, and changes in preference for civil service exams may impact the characteristics and rental demand of the commercial area. It is necessary to predict these changes and establish response strategies.
- Rental Status and Vacancy Risk: The current rental status (occupancy rate, lease term, rental rates), tenant stability, and potential risk of vacancy must be carefully analyzed.
- Market Volatility: The real estate market can be affected by external factors such as interest rate fluctuations and economic conditions. Careful judgment regarding market conditions is necessary during investment.
- Expert Advice: Investing in small buildings, especially in areas with development boosts, is complex and requires specialized analysis. It is important to seek assistance from a reliable real estate expert for thorough analysis and prudent investment decisions.
Detailed Transaction Analysis
Let's examine the specific transaction details of the building at Noryangjin-dong 237-17, Dongjak-gu.
※ Transaction Details
- Location: Dongjak-gu Noryangjin-dong 237-17
- Subway Station: Noryangjin Station (Transfer station for Lines 1 and 9)
- Transaction Date: February 2025
- Sale Price: 2.1 billion Won
- Land Price (Per Pyeong): 52.99 million Won
- Land Area: 39.63 pyeong (131㎡)
- Building Area (Total Floor Area): 53.80 pyeong (177.84㎡)
- Zoning District: Second Class General Residential Zone
- Floors: B1F ~ 2F
- Road Condition: 6m road
- Year of Completion: 1984.08.14
- Official Standard Land Price (공시지가): Approx. 16.51 million Won (Per Pyeong)
- Land Price Relative to Official Standard Price: Approx. 3.21 times
Key Features:
- Near Noryangjin New Town development beneficiary area
- Near elementary school
- Near Noryangjin Station (Transfer station)
- 2.1 billion Won transaction (Low 2 billion Won range)
- Land area 39.63 pyeong, Total floor area 53.80 pyeong
- Second Class General Residential Zone
- B1F to 2F building (Completed in 1984, aging)
- Fronting a 6m road
This transaction is a case where an aging building with a total floor area of 53.80 pyeong (B1F to 2F) on a land area of approximately 39.63 pyeong was transacted for 2.1 billion Won, at approximately 52.99 million Won per pyeong. It has the locational conditions of being near the Noryangjin New Town development beneficiary area, near an elementary school, and near Noryangjin Station, and belongs to a Second Class General Residential Zone with a land area of 39.63 pyeong. In February 2025, it was an attractive investment opportunity to secure a building near a core development area in Noryangjin for a relatively manageable amount in the low 2 billion Won range. Although the building was aging, completed in 1984, its potential for future value increase was highly evaluated based on the Noryangjin New Town development boost, the stable rental demand near the elementary school, and the locational advantages near Noryangjin Station. The high ratio of land price relative to the official standard price (3.21 times) reflects the value of this location.
Conclusion: Noryangjin Small Building, Synergy of New Town Development and Location
The case study of the 2.1 billion Won small building near Noryangjin Elementary School in Noryangjin-dong, Dongjak-gu, demonstrates that even with a small investment in the 2 billion Won range, attractive investment opportunities can be seized in core areas of Seoul when combining the Noryangjin New Town development boost, stable rental demand near an elementary school, and the locational strength near Noryangjin Station. The potential for value increase through remodeling or new construction of the aging building is also noteworthy.
Investing in Noryangjin small buildings is an attractive option that offers the potential for stable rental income along with long-term asset value appreciation, based on the synergy of the Noryangjin New Town development boost and location. However, it is important to carefully analyze risk factors such as building age and utilization plans, changes in the commercial area, rental status and vacancy risk, and market volatility, and make wise investment decisions with expert advice. Investing in areas near New Town development may require a bold decision, focusing on future advantages rather than disadvantages.