Pricing an 84.9 m² Apartment With Three Adjusted Comparables
You are preparing a listing presentation for Ms. Choi, owner of a 24-year-old, 84.9 m² apartment in Sinseol-dong. The subject is on the 12th floor of 15, south-facing, includes one parking space, had a kitchen renovation two years ago costing 8,000,000 KRW, is 400 m from the subway, and is in a sought-after elementary school zone. Three closed comparables are available. Comp A: same complex, 84.9 m², 10th floor, south, one parking, original kitchen, closed 30 days ago at 612,000,000 KRW. Comp B: same complex, 84.9 m², 4th floor, north, no parking, original kitchen, closed 45 days ago at 576,000,000 KRW. Comp C: adjacent complex built 5 years ago, 84.5 m², 15th floor, south, two parking spaces, renovated kitchen, 200 m from subway, closed 60 days ago at 648,000,000 KRW. Your office uses these adjustments: 1,500,000 KRW per floor; 12,000,000 KRW for a parking space; 8,000,000 KRW for a renovated kitchen; 6,000,000 KRW for south versus north exposure; 1,200,000 KRW per year of building age; 500,000 KRW per 100 m of subway distance. The market has declined 0.4% per month. Ms. Choi wants to list at 640,000,000 KRW and expects 630,000,000 KRW within 30 days; traffic is slow, with six showings and two offers at 585,000,000 and 590,000,000 KRW.
1. Calculate the adjusted value indication for each comparable as of today. Show each adjustment and the time adjustment.
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Comp A needs only two physical adjustments: the subject is two floors higher (+2 × 1,500,000 = +3,000,000 KRW) and has a renovated kitchen (+8,000,000 KRW). Adjusted physical value = 612,000,000 + 3,000,000 + 8,000,000 = 623,000,000 KRW. The sale was 30 days ago, so apply one month of decline: 623,000,000 × 0.996 = 620,508,000 KRW, or about 620,500,000 KRW.
Comp B is inferior in floor, parking, kitchen, and exposure. Floor: subject is eight floors higher (+8 × 1,500,000 = +12,000,000). Parking: subject has one space (+12,000,000). Kitchen: subject is renovated (+8,000,000). Exposure: south versus north (+6,000,000). Adjusted physical value = 576,000,000 + 12,000,000 + 12,000,000 + 8,000,000 + 6,000,000 = 614,000,000 KRW. The sale was 45 days ago, or 1.5 months: 614,000,000 × 0.994 = 610,316,000 KRW, or about 610,300,000 KRW.
Comp C is newer and superior in floor, parking, and subway distance. Age: subject is five years older (5 × 1,200,000 = -6,000,000). Floor: subject is three floors lower (3 × 1,500,000 = -4,500,000). Parking: comp has two spaces, subject has one (-12,000,000). Subway: subject is 200 m farther (-1,000,000). Kitchen and exposure are equal. Adjusted physical value = 648,000,000 - 6,000,000 - 4,500,000 - 12,000,000 - 1,000,000 = 624,500,000 KRW. The sale was 60 days ago, or two months: 624,500,000 × 0.992 = 619,504,000 KRW, or about 619,500,000 KRW.
2. Reconcile the three indications and recommend a list price and expected sale range. Evaluate Ms. Choi's 640,000,000 KRW target.
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The adjusted indications are tightly clustered: about 620,500,000 KRW (Comp A), 610,300,000 KRW (Comp B), and 619,500,000 KRW (Comp C). Comp A deserves the most weight because it is in the same complex, has the same unit size, and is the most recent sale. Comp C supports the upper end despite the age and parking adjustments. Comp B is the least reliable because it required the largest adjustments and is a low-floor, north-facing unit.
A reconciled value is approximately 618,000,000 to 621,000,000 KRW, with a likely sale range of 610,000,000 to 622,000,000 KRW after negotiation. A sensible list price is 622,000,000 to 625,000,000 KRW, leaving a small negotiating cushion without pricing the unit out of the market. Ms. Choi's 640,000,000 KRW target is about 3% above the highest adjusted indication and has no support from these comparables. A 630,000,000 KRW sale within 30 days would require a school-zone buyer who values the renovation and parking above the market evidence; that is possible but should not be the base case. At 640,000,000 KRW, the six showings and two low offers suggest the market is already rejecting the price, not that buyers are merely negotiating.
3. Given the slow traffic and the two low offers, outline a 30-day pricing and marketing plan and what you should tell Ms. Choi.
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Tell Ms. Choi the evidence supports a list price near 625,000,000 KRW, not 640,000,000 KRW, and that the two offers at 585,000,000 and 590,000,000 KRW are below the adjusted range but are a signal that the current price is outside buyer expectations. Recommend a two-week test at 625,000,000 KRW with a written review date. If there are no offers above 600,000,000 KRW by day 14, reduce to 615,000,000 to 618,000,000 KRW rather than making small cuts. Market the unit to school-zone families and commuters: professional photos, a floor plan showing the 84.9 m² layout, a one-page list of the kitchen renovation, parking, floor, and school assignment, and a broker open house. Pre-market to the office database and to buyers who lost nearby bids. Track showing feedback by price objection rather than relying on traffic alone. Do not chase the two low offers; use them as evidence for the pricing conversation, and require any counteroffer to be in writing with a short expiration.