Rising Sale Prices Spark Interest in ‘Gyeongsan 2nd I-Park’ Complex Offering ‘Interest-Free Interim Payments’

- Apartment sale prices have recently fallen due to high interest rates, but show an upward trend compared to pre-sale prices
- Pre-sale prices expected to rise due to increases in interest rates, land prices, and raw material costs... 'Interest-free interim payments' complexes attract attention amid the interest rate cycle

Although apartment sale prices have been declining recently due to the real estate market downturn, they have shown a considerable increase compared to the pre-sale prices.

According to industry data, the average nationwide apartment sale price per 3.3㎡ steadily rose to 22.35 million KRW last year, stabilized around 22.40 million KRW at the beginning of this year, and recently declined to 22.33 million KRW. While overall housing prices are on a downward trend, these figures represent an increase compared to the pre-sale prices. During the same period, the average pre-sale price per 3.3㎡ remained in the mid-14 million KRW range. Considering this, the current sale price is about twice the pre-sale price.

However, with recent increases in the base interest rate, land prices, and construction raw material costs, pre-sale prices are expected to continue rising. Last month, the Bank of Korea set the base interest rate at 2.50% per annum, marking a sharp 2.00 percentage point increase within a year. Additionally, on September 22, the U.S. Federal Reserve implemented a third consecutive giant step, raising the base interest rate to 3.25%, making further interest rate hikes in Korea inevitable.

Furthermore, according to the Korea Real Estate Board, the land price index has risen annually over the past five years (2017?2021) from 90 to 94, 98, 101, and 105. Cement prices have continuously increased from 75,000?78,000 KRW per ton in July last year and are expected to exceed 100,000 KRW per ton.

An industry insider stated, “Even though apartment sale prices are on a downward curve, they are not falling to the level of pre-sale prices. Statistically, the prices have risen significantly compared to pre-sale prices, and with various factors signaling further pre-sale price increases, future demand is expected to concentrate on locations offering financial benefits.”

In particular, attention is expected to focus on pre-sale complexes offering interest-free interim payment loans. Reviewing the Bank of Korea’s base interest rate trends since 2000, it is evident that the rate has typically been adjusted downward every two-year cycle in January. Based on this, complexes offering interest-free interim payments are considered valuable because the project developer pays the loan interest on behalf of buyers, eliminating economic burdens at present and providing an advantage at move-in time, as interest rates are expected to stabilize within two years.

As interest rates and raw material prices rise, signaling pre-sale price increases, complexes offering benefits such as interest-free interim payments that reduce economic burdens are attracting attention.

‘Gyeongsan 2nd I-Park’ is being developed in the Apnyang-eup area of Gyeongsan-si, Gyeongsangbuk-do, consisting of 745 units ranging from 84 to 134㎡ across 33 floors above ground and 2 basement levels. The complex significantly reduces economic burdens by offering interest-free interim payments and free balcony expansions. Additionally, Gyeongsan-si in Gyeongsangbuk-do is a non-regulated area where anyone aged 19 or older, regardless of homeownership status or residence, can apply for subscription without restrictions on re-winning or mandatory residence, attracting substantial demand.

‘Gyeongsan 2nd I-Park’ also boasts excellent living conditions. Nearby infrastructure includes Daegu Subway Line 2’s Yeungnam University Station, Homeplus Gyeongsan, CGV Gyeongsan, and Mawiji Park, enabling convenient living. The area is also close to Apnyang Elementary School, Hyeonheung Elementary School, Apnyang Middle School, Gyeongsan Science High School, and Yeungnam University, with new elementary and high school sites secured within the Apnyang district, ensuring a favorable educational environment. Furthermore, the Gyeongsan 1st, 2nd, 3rd, and 4th general industrial complexes are reachable within 10 minutes by car, providing excellent proximity to workplaces and abundant industrial complex demand.

The complex also holds high future value. The Apnyang district, where ‘Gyeongsan 2nd I-Park’ is located, is planned to be developed into a mini new town spanning approximately 1.1 million ㎡ by combining with the adjacent Shindaebu-jeok district. Residents will benefit from the diverse infrastructure of the already developed Shindaebu-jeok district, and the development is expected to bring significant residential-centered changes.

The model house for ‘Gyeongsan 2nd I-Park’ is scheduled to open in early October.