"Can't Bear Housing Prices"... 1 in 2 Buyers of Hanam Apartments Are Seoul Residents

Seoul Residents' Share of Apartment Purchases in Gyeonggi Province Surpasses 20% for the First Time in July
Hanam, Guri, and Gwangmyeong Near Seoul Reach 40-50% Purchase Share

Apartment complex view in Gangnam-gu, Seoul [Image source=Yonhap News]

[Asia Economy Reporter Onyu Lim] In July, the proportion of apartment purchases in Gyeonggi Province by Seoul residents surpassed 20% for the first time ever. This is because real demand buyers, unable to endure soaring house prices and jeonse prices in Seoul, are showing a 탈(?)-Seoul trend toward Gyeonggi Province, where housing prices are relatively cheaper. In particular, in Hanam, Guri, and Gwangmyeong, which have good accessibility to Seoul, the proportion of apartment purchases by Seoul residents reaches 40-50%.

According to the Korea Real Estate Board on the 24th, there were a total of 16,580 apartment sales transactions in Gyeonggi Province in July, of which 3,355 transactions, or 20.2%, were purchased by Seoul residents. This is the first time the proportion of apartment purchases in Gyeonggi Province by Seoul residents has exceeded 20%. This proportion, which was only 13.3% in January last year, increased to 15.1% in May, 18.4% in December, and after recording 19.3% in May this year, it set a new record once again.

Among the 31 cities and counties in Gyeonggi Province, the areas with the highest proportion of apartment purchases by Seoul residents were Hanam, Guri, and Gwangmyeong. In Hanam, the proportion of purchases by Seoul residents reached 55.6% (104 out of 187 transactions). This area is adjacent to Songpa and Gangdong districts in Seoul, and with the opening of Subway Line 5 in March, the improved transportation environment has enhanced accessibility to Seoul, making it popular among Seoul residents.

Next, Guri, which borders Jungnang and Nowon districts, had a high proportion of purchases by Seoul residents at 45.3% (111 out of 245 transactions). Following that, Gwangmyeong, close to Guro and Geumcheon districts, recorded 40.4% (114 out of 282 transactions).

Experts analyze that the recent 탈(?)-Seoul trend toward Gyeonggi Province is a result of rising house prices and jeonse prices. Seoul residents without homes, anxious about soaring prices, have chosen to live as homeowners in Gyeonggi Province despite inconveniences such as increased distance from their workplaces. The reason tenants, who have experienced the hardship of being homeless due to the intensified jeonse crisis after the implementation of the new Lease Protection Act, are heading to Gyeonggi Province is in the same context.

The Korea Research Institute for Construction Industry analyzed, "Seoul residents in their 30s and 40s without homes find it difficult to purchase median-priced homes in Seoul or the homes they currently live in under jeonse with only jeonse funds due to rising housing prices and restrictions on mortgage loan ratios."

As the demand for homeownership by Seoul residents disperses from Seoul to Gyeonggi Province, housing prices in Gyeonggi Province have also been rising rapidly recently. According to KB Kookmin Bank, the apartment sales price index in Gyeonggi Province rose by 18.68% from January to August. This figure is three times the 6.53% increase during the same period last year and even surpasses the cumulative 12.66% increase for the entire last year. For example, the actual transaction price of a 93.94㎡ (exclusive area) unit in Hanam Seondong Misagangbyeon Prugio 2nd phase rose from 1.2 billion KRW in January to 1.3 billion KRW in August, increasing by 100 million KRW in just seven months.