Pre-sale Price and Infrastructure Appeal 'Pre-Subscription'... Capturing Buyers' Hearts [Let's Run Again, Construction Korea]

All Pre-Subscription Units This Year Total 32,000 Completed Through 3rd Phase with Over 260,000 Applicants
3rd Generation New Towns Most Popular... 4 Districts Including Hanam Gyosan Average 16:1
Sale Prices at 60-80% of Nearby Market, Comfortable with Green Spaces and New Transport Networks
3rd Generation Expected to Become Premium Cities Combining LH Development Expertise

Example of Incheon Gyeyang Linear Park 'Gyeyang Byeori'.

One of the main choices for genuine homebuyers wanting to purchase their own home amid this year's real estate supply shortage was the 'pre-sale subscription.' The pre-sale subscription system allows applicants to apply for public sale housing supplied on public land, with the supply schedule advanced. First introduced 12 years ago in 2009 for the Bogumjari housing developments such as Hanam Misa, which were developed by lifting the greenbelt restrictions around Seoul and its surrounding areas, the popularity of pre-sale subscriptions has surged again. The total supply through the four pre-sale subscription rounds conducted this year amounts to 32,000 households.

According to the Korea Land and Housing Corporation (LH) on the 28th, as of now, the third round of pre-sale subscriptions has been completed, with a total of 18,602 households recruited and approximately 264,000 applicants, recording an average competition ratio of 14.2 to 1. Among the pre-sale supply, the 3rd generation new towns were the most popular, with 6,8302 applicants for 4,167 households across four districts including Hanam Gyosan, showing an average competition ratio of 16 to 1. By round, the highest competition ratios were recorded as follows: In the 1st round, Incheon Gyeyang A2 Block 84㎡ type at 381.1 to 1; in the 2nd round, Namyangju Wangsuk2 A3 Block 84㎡ type at 81.2 to 1; and in the 3rd round, Hanam Gyosan A2 Block 59㎡ type at 67.4 to 1.

The reasonable pricing is cited as the primary factor for the popularity of pre-sale subscriptions. Given the continued surge in real estate prices this year, the sale prices, which are at 60-80% of the surrounding market prices, are naturally attractive. For example, the estimated sale price for Hanam Gyosan A-2 Block 59㎡ type is 480 million KRW, or 18 million KRW per 3.3㎡, which is about 65% of the surrounding market price of 28 million KRW per 3.3㎡. The estimated sale price for Namyangju Wangsuk2 A-3 Block 84㎡ type is 560 million KRW, or 16 million KRW per 3.3㎡, boasting a low price at 60% of the surrounding market price of 27 million KRW per 3.3㎡.

Additionally, enjoying ample living infrastructure in large-scale complexes on public land is a significant advantage. As proven in areas like Pangyo, Wirye, Dongtan, and Misa, public land developments are highly preferred due to their ample green spaces such as parks, convenient lifestyle facilities in central commercial areas, and newly established transportation networks, offering a pleasant environment compared to existing urban centers. The pre-sale subscription supply also possesses these advantages of public land, and especially the 3rd generation new towns are expected to be developed into premium cities distinct from existing cities, reflecting LH's accumulated development expertise. In fact, LH plans to create differentiated cities by introducing specialized plans for each district based on common development concepts of the 3rd generation new towns, such as excellent locations near Seoul, rail-centered transportation networks, child-friendly environments, and job-centered cities. As seen from the competition ratios, the popularity of the 3rd generation new towns is expected to continue, given that they are large-scale metropolitan area land developments following the 2nd generation new towns.

Against this backdrop, pre-sale subscriptions on public land with reasonable prices and quality have become one of the rational alternatives for genuine homebuyers to secure their own homes. At the time of the 2009 Bogumjari pre-sale subscription, the sale price for Hanam Misa district was around 350 million KRW, but the current market price has exceeded 1 billion KRW. Those who purchased through pre-sale subscriptions have not only secured stable living but also gained capital gains exceeding 500 million KRW. This year’s pre-sale subscriptions also offer affordable prices compared to surrounding market prices and high-quality large-scale complexes, which is why it is expected that buyers can achieve both homeownership and capital gains.

The final 4th round of pre-sale subscriptions this year will begin with the recruitment announcement on the 29th. It is planned to supply more than 10,000 households across 12 districts, the largest number among the four rounds, and experts advise that those without homes should actively apply. Especially since pre-sale subscriptions will continue next year and not only public sale but also private apartments can be purchased through pre-sale subscriptions, it is necessary to increase the possibility of homeownership through thorough preparation such as subscribing to housing subscription savings.

Experts also advise that, given the recent sharp decline in sales and the uncertain outlook for the real estate market, genuine buyers should focus on pre-sale subscriptions and other sales rather than aggressive borrowing and buying. This is because pre-sale subscription supplies will continue to be released, and public redevelopment projects are accelerating, increasing the supply within Seoul’s urban center year by year.

Besides pre-sale subscriptions and public redevelopment, LH supplies more than 10,000 public housing units annually, making targeting these sales a rational choice. LH supplied 19,921 public sale units nationwide this year alone and plans to recruit residents for about 25,000 public sale housing units next year, which is even more than this year.

An LH official said, "We are making every effort to expand supply, including advancing next year’s supply schedule as much as possible to resolve the temporary supply shortage," adding, "We hope that people will secure their homes at reasonable prices through applications for various supplies such as LH public sales, pre-sale subscriptions, and urban redevelopment projects rather than chasing purchases."

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