Hot Apartment Prices in 'Incheon'... Soaring Growth Rate Even During the Holiday Period

Capital Region's Upward Trend Paused but Incheon Maintains
Apartment and Villa Prices Surge Amid Buying Frenzy
Transportation Improvements Boost... Supply of New Units Increasing

High-rise apartment buildings in Dongchun-dong and Songdo International City as seen from Cheongryangsan in Dongchun-dong, Yeonsu-gu, Incheon City [Image source=Yonhap News]

Apartment prices in Incheon continue their soaring trend. Although the buying momentum slowed during the Chuseok holiday period, leading to a reduction in apartment price growth rates in most regions nationwide including Seoul, Incheon maintained the same upward trend as the previous week. Analysts suggest that the overheating of the real estate market is intensifying as genuine buyers, exhausted by the soaring housing prices in Seoul and Gyeonggi Province, are moving en masse to Incheon.

According to the Korea Real Estate Board on the 25th, apartment prices in Incheon rose by 0.45% this week, the same as the previous week. Since mid-last month, Incheon has continued its upward trend with increases of 0.41% → 0.43% → 0.44% → 0.45% → 0.45%. This month, Yeonsu-gu saw a sharp rise of 1.95% in apartment prices, followed by Gyeyang-gu (1.54%), Bupyeong-gu (1.42%), and Seo-gu (1.38%).

While the Seoul metropolitan area experienced a slowdown in the upward trend this week due to fatigue from prolonged high growth rates and a decrease in buying activity before the Chuseok holiday, the real estate heat in Incheon shows little sign of cooling. The metropolitan area’s growth rate was limited to 0.36%, as Gyeonggi Province’s rate slowed for two consecutive weeks (0.51 → 0.49 → 0.43 → 0.36%). This is a slight decrease compared to the previous week’s 0.40%.

It is analyzed that many non-homeowners or tenants in the metropolitan area are moving to Incheon, where housing prices are relatively lower, driving prices up. Incheon has been somewhat excluded from the rising market compared to Seoul or Gyeonggi Province, and with various development benefits such as the Metropolitan Area Express Train (GTX), investment demand is also increasing. Some areas in Incheon remain designated as regulated zones, and there are complexes where gap investments are easy, leaving investment opportunities available.

According to the Ministry of Land, Infrastructure and Transport’s real transaction price disclosure system, an 84.25㎡ unit (exclusive area) in ePyeonhansesang Songdo, Songdo-dong, Yeonsu-gu, was traded for 690 million KRW at the beginning of this year but sold for 900 million KRW on the 5th of this month, rising by about 100 to 200 million KRW. A 291㎡ unit in The Sharp Central Park 2, Songdo-dong, Yeonsu-gu, was traded for 4.5 billion KRW on the 13th, marking the highest price recorded in Incheon this year.

As apartment prices in Incheon soar, prices of relatively affordable multi-family houses and row houses are also rising sharply. Villa prices in Incheon increased by 6.24% until last month, higher than Seoul’s 4.73% and Gyeonggi Province’s 6.02%. Genuine buyers are purchasing villas instead of apartments, or investors are flocking to villas with weaker regulations, hoping for redevelopment and reconstruction projects, increasing demand.

Expectations that Incheon’s improved transportation network will enhance accessibility to Seoul compared to the outskirts of Gyeonggi Province are also influencing the rise in housing prices. Plans include the GTX-B line connecting Incheon to Seoul and the second phase of the Line 7 extension project (Bupyeong-gu Office Station to Seoknam Station) extending to Cheongna International City. However, since the supply of new housing units in Incheon is expected to increase significantly by the year after next, there is a possibility that future transaction price trends may change, prompting warnings against 'blind investments.'