The 30s and 40s generation are recently falling behind in apartment subscription markets due to insufficient points, moving further away from winning chances. Additionally, with both jeonse (long-term deposit lease) and monthly rents soaring, housing difficulties are intensifying. Accordingly, the younger generation's perspective on rental housing seems to have changed significantly. In particular, the government announced plans to supply 70,000 rental housing units in the metropolitan area over the next two years, bringing a 'favorable breeze' to the rental market, and demand is focusing on the upcoming public-supported private rental housing.
- What is public-supported private rental housing?
Public-supported private rental housing is a corporate-type rental apartment characterized by flexible subscription conditions. First, a subscription savings account is not required, and any household member aged 19 or older without home ownership can apply nationwide. It is unrelated to income level (based on general supply), winning history, and there is no burden of acquisition tax or holding tax. It is not counted as a housing unit, so residents can apply for general sale apartment subscriptions even while living there.
Especially recently, with jeonse and monthly rents soaring mainly in the metropolitan area, the advantages of public-supported private rental housing, which guarantees a minimum rental period of 8 years and limits rent increases to within 5% annually, are highlighted.
In the case of general apartments, the lease term has been extended up to 4 years under the Lease Protection Act, and the deposit increase rate at contract renewal is limited to 5%, leading to a phenomenon where landlords try to raise the deposit as much as possible at new contracts, causing not only jeonse prices but also monthly rents to rise. In contrast, public-supported private rental housing guarantees rental for up to 8 years and limits rent increases to within 5% annually during this period, providing a stable residential environment.
As the advantages of public-supported private rental housing attract the attention of demanders, supply is also progressing smoothly. The public-supported private rental housing 'Pyeongtaek Godeok Eoullim Square' in Block A11 of Godeok International New City, Pyeongtaek City, completed tenant recruitment in a short period after subscription in August.
Meanwhile, a noteworthy public-supported private rental apartment in Bongdam 2 District, Hwaseong, Gyeonggi Province, is about to recruit tenants, attracting demanders' interest. The protagonist is 'Hillstate Bongdam,' constructed by Hyundai Engineering & Construction.
Hillstate Bongdam is planned to be built with 11 buildings ranging from basement level 1 to a maximum of 25 floors above ground, totaling 1,004 households with exclusive areas of 62 to 84 square meters.
Hwaseong City, where Hillstate Bongdam is located, is a regulated area subject to loan and subscription restrictions. However, Hillstate Bongdam, supplied as public-supported private rental housing, is a complex where anyone nationwide who is 19 or older and a household member without home ownership can apply regardless of subscription savings account status, income level (general supply basis), or winning history.
Rental burden is also reduced. For the exclusive area of 84㎡, the deposit ranges from 95 million KRW (monthly rent 480,000 KRW) to 166 million KRW (monthly rent 240,000 KRW). The minimum rental guarantee period is 8 years, with rent increase rates limited to within 5% annually, and there is no burden of acquisition tax or holding tax.
- Outstanding residential infrastructure stands out
Since Bongdam District is a public land development district, excellent residential infrastructure is notable. First, access is easy via Pyeongtaek-Paju Expressway, Metropolitan Area 2nd Ring Expressway (Bongdam-Dongtan section), and Gwacheon-Bongdam Urban Expressway. The excellent educational environment also draws attention. Right next to Hillstate Bongdam are a kindergarten (planned), Suhyeon Elementary School, and Suhyeon Middle School (planned). A high school (planned) is about 500 meters away, allowing for walking commute. In front of Hillstate Bongdam, a central commercial district is planned, and nearby are E-Mart (Hwaseong Bongdam branch), Hanaro Mart (Bongdam branch), and infrastructure in West Suwon such as Homeplus (Seosuwon branch), AK Plaza (Suwon branch), and Lotte Mall (Suwon branch) can also be used. Parks such as Bongdam Lake Park and Hwaseong National Sports Center are available, enabling a healthy lifestyle.
A sales representative of Hillstate Bongdam said, “It is a branded large complex apartment supplied in a public land development district with a good residential environment, and the infrastructure in the area is well established, so there are many interested customers, with many inquiries from actual demanders in their 30s and 40s. Due to loan and subscription restrictions, it has become difficult to purchase a home with a large sum of money, so it is a characteristic that you can live without worrying about financial burden, and there is no difference in product competitiveness compared to general sale apartments.”
Meanwhile, the Hillstate Bongdam model house is located at 895-1 Maesong Gosaek-ro, Gwonseon-gu, Suwon City, and the expected move-in date is June 2021.
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