Gyeonggi Apartment Transactions Double... Semiconductor Benefit 'Optical Illusion'?

Trading Concentrated in Southern Gyeonggi with Semiconductor Development Boost
Northwestern Gyeonggi Areas like Uijeongbu See Widening Declines
Number of Transactions Increased but Growth Slows... "Bottoming Out Premature"

The volume of apartment transactions in Gyeonggi Province has nearly doubled compared to early this year, raising expectations for market recovery in Gyeonggi following Seoul. However, some argue that the rebound in transactions and prices is concentrated only in certain areas such as Hwaseong, Suwon, and Yongin, where semiconductor development prospects are expected, while other regions show contrasting trends, suggesting that this may be a kind of optical illusion caused by semiconductor benefits.

The area around Namsa-eup, Yongin-si, Gyeonggi-do, designated as a large-scale semiconductor national industrial complex.
[Image source=Yonhap News]

According to the Gyeonggi Real Estate Portal on the 28th, the number of apartment sales transactions in Gyeonggi for May was recorded at 9,973. Apartment sales volumes were 9,204 in March and 9,116 in April, approaching 10,000 for three consecutive months. Since the reporting deadline for May transactions is at the end of this month, it is highly likely that the number will exceed 10,000 if the current trend continues. This is a markedly different pattern compared to 4,760 transactions in January this year, which was below 5,000.

As transaction volumes increase, complexes with rising actual transaction prices are appearing in various locations. According to the Ministry of Land, Infrastructure and Transport's Real Transaction Price Disclosure System, a 107㎡ unit in Hills State Gwanggyo, Hadong, Yeongtong-gu, Suwon, was traded for 1.97 billion KRW (28th floor) on the 3rd of this month. This is 410 million KRW higher than the price of the same size unit traded last month at 1.56 billion KRW (3rd floor). In Hwaseong, Gyeonggi, a 84㎡ unit in Dongtan Station Shibeom Ban Do Yubora Ivy Park 4.0 was traded for 968 million KRW (39th floor) on the 9th, more than 200 million KRW higher than the previous transaction price of 755 million KRW (11th floor).

However, the market consensus is that it is difficult to argue that the Gyeonggi real estate market has bottomed out based on this. A significant portion of Gyeonggi apartment sales volume has been concentrated in the southern Gyeonggi areas such as Hwaseong, Suwon, and Yongin, where semiconductor development prospects have recently been concentrated. According to the Gyeonggi Real Estate Portal, the region with the highest cumulative transaction volume from January to May this year was Hwaseong with 4,260 transactions, followed by Suwon (3,885 transactions) and Yongin (3,715 transactions). Hwaseong and Suwon are residential areas behind Samsung Electronics' semiconductor factories, and Yongin is where the Samsung semiconductor cluster is planned to be established.

On the other hand, the northwestern part of Gyeonggi, which is outside the semiconductor influence zone, shows a contrasting trend with prices declining, unlike the southern areas where positive factors are concentrated. According to the Korea Real Estate Board as of the third week of June (19th), the house price change rate in Uijeongbu widened its decline from -0.11% in the second week of June to -0.43% in the third week. Dongducheon (-0.13% → -0.16%) and Bucheon (-0.07% → -0.10%) showed similar patterns. This contrasts with the apartment prices in Cheoin-gu, Yongin, where the semiconductor cluster development prospects exist, which have been rising for 13 consecutive weeks since the fourth week of March (27th).

Above all, the market leans toward the view that it is premature to declare a recovery as the recent increase in transaction volume is showing signs of slowing down. Although the number of apartment sales in Gyeonggi Province has increased somewhat, the recent trend shows a slowdown in the growth of apartment sales volume. In fact, in February this year, transactions recorded 8,633, an 81.37% increase from the previous month (4,760), but in March, the month-on-month growth rate was only 6.61%, and in April, it even decreased by 0.96% compared to the previous month.

Yoon Soo-min, a real estate specialist at NH Nonghyup Bank, explained, "Although apartment sales in Gyeonggi Province have increased somewhat, the overall growth trend is slowing, and the northern Gyeonggi area, which has many bedroom towns, is showing a contrasting trend with an expanding decline in house prices. Especially considering that investment demand has temporarily concentrated in Yongin, Hwaseong, and Suwon, where jobs are abundant and semiconductor development prospects are concentrated, it is difficult to conclude that the Gyeonggi real estate market has recovered."

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