'3rd New Town Jeonse Shortage' Hanam's High Price Surge Continues for 48 Weeks

"Complete 2-Year Residency" Buzz Ahead of 3rd New Town Pre-Subscription
Hanam, Near Gangnam, Rental Supply Hits Bottom
Namyangju "Even 20-Year-Old Apartments Hard to Find for Rent"

[Asia Economy Reporter Lim On-yu] "Both newly built and older properties are scarce on the market. This is because demand is flooding in to obtain eligibility for new town subscription." (A representative from real estate agency A in Deokpung-dong, Hanam-si, Gyeonggi Province)

The rental market around the 3rd phase new towns in the metropolitan area is stirring. This is due to the influx of demand aiming to fulfill the minimum mandatory residence period of two years ahead of the apartment pre-subscription, which is expected to start as early as the end of next year. In particular, Hanam, which has relatively excellent access to the Gangnam area, has seen rental prices rise for 48 consecutive weeks. This is similar to the surge in rental prices before the subscription for Gwacheon Knowledge Information Town last year.

According to the weekly apartment price trend report by the Korea Real Estate Board on the 15th, rental prices in Hanam (0.68%), Deokyang-gu in Goyang (0.09%), Namyangju (0.15%), Bucheon (0.18%), and Gyeyang-gu in Incheon (0.06%), all designated as 3rd phase new town sites, rose simultaneously in the second week of this month. Hanam has maintained an upward trend for 48 consecutive weeks since the third week of July last year. The rate of increase is more than five times the Gyeonggi Province average increase rate of 0.15%. Namyangju (0.15%) and Bucheon have risen for 12 and 5 consecutive weeks, respectively.

In fact, a rental contract for an 84㎡ unit (exclusive area) in Pungsan I-Park Complex 1 in Deokpung-dong, Hanam, was recently signed for 510 million KRW despite being on a lower floor. Local real estate agents report that this is a 60 million KRW increase in just two months.

The sharp rise in rental prices in this area is analyzed to be due to the massive influx of demand waiting for the 3rd phase new town subscription. According to the revised Housing Act, to qualify as a first-priority applicant for subscription, one must reside in the relevant area for at least two years. The government's announcement to implement pre-subscription in public land such as the 3rd phase new towns has made this trend more pronounced. Since the projects in Hanam Gyosan and Namyangju Wangsuk are progressing rapidly, subscriptions could start as early as the end of next year.

Especially in Hanam, rental prices are soaring as rental supply has dried up following the recent announcement of a metropolitan transportation improvement plan emphasizing improved access to Gangnam. Previously, the Ministry of Land, Infrastructure and Transport announced plans to build an urban railway between Songpa and Hanam, enabling commuting to downtown Seoul within 30 minutes.

The rental price for an 84㎡ unit in KCC Switzen in Deokpung-dong rose by 50 million KRW in four months, from 300 million KRW in January to 350 million KRW last month. The 84㎡ unit in Union City Aileen's Garden in Sinjang-dong was traded at 500 million KRW in April this year, 100 million KRW higher than six months ago. A representative from real estate agency B in Sinjang-dong said, "There are many people looking, but no properties available, so rental transactions are difficult," and predicted, "Demand waiting for the 3rd phase new town subscription is likely to increase further, so rental prices will continue to rise."

The waiting demand in Namyangju Wangsuk, the largest among the 3rd phase new towns, is also considerable. A representative from real estate agency C in the area explained, "Although it looks like there are many rental listings on portal sites, it is very difficult to find listings that match the price and date," adding, "Even rentals for 20-year-old Booyoung Apartments near Donong Station are all being leased." The rental price for an 84㎡ unit in E-Pyeonhansesang Xi in Dasan-dong, Namyangju, rose by 80 million KRW in 10 months, from 280 million KRW in July last year to 360 million KRW in May this year.

However, the market atmosphere varies somewhat by new town. Western new towns such as Bucheon Daejang and Incheon Gyeyang are relatively calmer compared to Hanam Gyosan and Namyangju Wangsuk. This is also reflected in recent population movements in these areas. According to Statistics Korea, the net population inflow to Hanam until April this year was 6,856. Although a large number of new apartments were occupied last year, increasing the population by 16,986, the population is rapidly increasing this year despite a significant reduction in new apartment supply. Namyangju and Goyang show similar trends. On the other hand, Bucheon and Incheon Gyeyang have shown a population decline since the beginning of this year.

A real estate industry official said, "Population inflow to the 3rd phase new towns will further fuel the rise in rental prices."

This content was produced with the assistance of AI translation services.