- 'Jeonse Supply-Demand Index' and 'Jeonse Prices' Soar... Worsening Jeonse Crisis
- Steep Jeonse Price Increase in 'Incheon'... Which Sale Complexes Will Attract Buyers This Year?
As the jeonse (long-term lease) shortage in the Incheon area intensifies, homebuyers are facing difficulties in finding solutions to secure their own homes.
According to the weekly housing market trend data from KB Real Estate, the jeonse supply-demand index is soaring, confirming a shortage of available listings. In fact, last month’s jeonse supply-demand index was 191.9, the highest in nearly 20 years since August 2001, when it recorded 193.7. KB LiveOn surveys real estate agents with questions such as 'supply shortage,' 'adequate,' and 'sufficient supply,' then indexes jeonse demand and supply volumes. The jeonse supply-demand index ranges from 0 to 200, with values above 100 indicating a higher proportion of 'supply shortage.'
Looking at the jeonse supply-demand index by region, Incheon scored 194.1, ranking fourth nationwide after Daegu (197.1), Gwangju (196.1), and Gyeonggi (195.7).
Jeonse prices are also continuously rising. According to statistics from the Korea Real Estate Board, Incheon’s jeonse price increase rate was 0.61% in the second week of November and rose by 0.52% in the third week. This is about twice the national apartment jeonse price increase rate of 0.30% recorded last week.
In particular, apartment jeonse prices in Yeonsu-gu, Incheon, rose 1.83% in the second week of November and continued to increase by 1.65% last week, maintaining a high growth rate. Seo-gu (0.43%) and Namdong-gu (0.40%) also saw continued increases.
A real estate expert said, “With the implementation of the three lease laws, the exercise of contract renewal rights by existing tenants has increased, leading to a continued shortage of jeonse listings,” adding, “Although the government has introduced comprehensive measures to resolve the jeonse shortage, there is skepticism about their effectiveness as they seem distant from providing stable residential spaces.”
In fact, on the 19th, the government announced a comprehensive housing supply plan including 114,000 housing units by 2022, but doubts remain about whether stable residential spaces will be supplied in locations desired by demanders.
Especially in Incheon, which has been designated as a regulated area, the shortage of jeonse supply has worsened, leading to increased interest in new housing sales. Due to the new lease laws, landlords are trying to raise jeonse prices in advance for four years, causing jeonse prices to soar and prompting more demanders to choose new housing sales.
In Incheon, about 3,598 units across seven sites have been sold in the second half of this year. Most sales have occurred only in the new towns of Jung-gu and Seo-gu, with no supply in the existing downtown area, so interest in new supply units is expected to continue.
Hanwha Construction plans to sell ‘Hanwha Forena Incheon Yeonsu’ in December at 151-3 Seonhak-dong, Yeonsu-gu, Incheon. The complex will consist of nine buildings, ranging from three basement floors to 23 above-ground floors, with a total of 767 units of a single exclusive area of 84㎡. It is located within the approximately 85,000㎡ Mujugol Neighborhood Park, the first private park special project in Incheon, providing a pleasant residential environment, and is adjacent to Munhak Mountain, offering permanent natural views. Within walking distance is Munhak Stadium Station on Incheon Subway Line 1, and just three subway stops away are Incheon City Hall Station on Line 2 and Woninjae Station on the Suin-Bundang Line, making access to Seoul and other Gyeonggi areas convenient. Large shopping facilities such as NewCore Outlet Incheon, Lotte Department Store Incheon Terminal Branch, Homeplus Guwol Branch, and the planned Guwol Starfield, as well as Gachon University Gil Hospital, are nearby.
Lotte Construction and POSCO Construction plan to sell ‘Bupyeong Castle & The Sharp First’ in December at 104 Cheongcheon-dong, Bupyeong-gu, Incheon. This is a redevelopment project of Cheongcheon 1 District, consisting of 12 buildings from two basement floors to 29 above-ground floors, with a total of 1,623 units ranging from 59 to 84㎡ (with 39㎡ rental units). Of these, 1,140 units will be sold to the general public. The Cheongcheon and Sanggok-dong areas are rapidly emerging as new residential districts with large-scale redevelopment projects expected to bring in about 15,000 units. The planned opening of San-gok Station on Line 7 in the first half of 2021 near the complex is expected to further increase its future value.
GS Construction plans to sell ‘Songdo Xi Crystal Ocean’ in November in Songdo International City. Located at A10BL, Songdo-dong, Yeonsu-gu, Incheon, the complex will consist of nine buildings from one basement floor to 42 above-ground floors, with a total of 1,503 units ranging from 84 to 205㎡. Each unit offers views of the West Sea and Incheon Bridge, and the planned Landmark City waterfront park will be directly connected to the complex. There are elementary and middle school sites right in front, and nearby are Chadwick International School Songdo, POSCO Autonomous Private High School, and Incheon Science and Arts Gifted School, providing an excellent educational environment for children.
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