Paradox of 3rd Phase New Town Pre-Subscription: 2nd Phase New Town Left Out in the Cold

[Asia Economy Reporter Yoo In-ho] The 2nd generation new towns are taking a direct hit from the early pre-sale of the 3rd generation new towns in the metropolitan area.

Some 2nd generation new towns such as Yangju Okjeong and Incheon Geomdan are located on the outskirts of the metropolitan area, so they are being overlooked by demanders in favor of the 3rd generation new towns adjacent to Seoul.

According to the industry on the 10th, 'Daekwang Roseviang' near Deokgye Station in Yangju Hoecheon, Gyeonggi-do, and 'Nobland Eduforet' Phase 3 in Yangju Okjeong New Town, which were pre-sold earlier this month, failed to fill residents in the first priority subscription.

While Daekwang Roseviang had only 14 units unsold, Nobland Eduforet had nearly 70% of the total 1,042 units, 688 units, unsold even in the second priority subscription.

Yangju City, where the new towns are being developed, was removed from the unsold housing management area at the end of June last month, but after being designated as a regulated area, the number of unsold units is also increasing.

According to the nationwide unsold housing status compiled by the Ministry of Land, Infrastructure and Transport, as of the end of July, the number of unsold units in Yangju was 530, an increase of 191 units compared to the previous month. Among the cities and counties in the metropolitan area, it is the second highest after Anseong City (617 units).

The transaction market is also weak. In 'Geomdan Kumho Eoullim Central' in Incheon Geomdan New Town, a pre-sale right for an exclusive 84㎡ unit (19th floor) was traded for 482.4 million KRW on the 27th of last month. Compared to the price of 552.4 million KRW traded on July 18, it dropped by nearly 70 million KRW.

The industry expects that other 2nd generation new towns such as Gimpo Hangang and Paju Unjeong will also be affected by the pre-sale of the 3rd generation new towns including Bucheon Daejang, Incheon Gyeyang, and Goyang Changneung districts.

In particular, since a significant number of 2nd generation new town units are scheduled to be additionally pre-sold within this year, there are concerns that the market situation will worsen further. The pre-sale units for each 2nd generation new town within this year are estimated to be ▲Yangju Okjeong 2,979 units ▲Paju Unjeong 3,966 units ▲Incheon Geomdan 3,393 units, totaling 17,467 units.

Yeokyung Hee, Senior Researcher at Real Estate 114, said, "Among the 2nd generation new towns, those that lack self-sufficiency or proper transportation networks are expected to have low competitiveness. Moreover, if the recent transaction cliff and weakened buying sentiment prolong, there is a high possibility that housing prices will turn downward."

Meanwhile, the Ministry of Land, Infrastructure and Transport plans to conduct pre-sales for 22,000 public housing units in the 3rd generation new towns including Namyangju Wangsuk, Hanam Gyosan, Bucheon Daejang, Incheon Gyeyang, and Goyang Changneung sequentially from July next year until 2022.