Recently, with the inflation era being anticipated and the correlation between stocks and bonds turning positive for the first time in 20 years, analyses suggest that the hedging effect through diversified investment has decreased. As a result, alternative assets such as real estate, commodities, and short-term government bonds are being recognized as useful assets during high inflation periods.
According to the industry, some experts who participated in the 'Role of Finance in the Inflation Era' policy seminar held at the Yeouido Financial Investment Center on the 13th explained that it may not be appropriate to use stocks and bonds as hedging tools in an era of rapidly rising prices. Since the correlation between these two asset classes, which had been negative for 20 years since the 2000s, recently turned positive, the diversification effect of adjusting ratios such as 60:40 or 50:50 has diminished.
Real estate, commodities, and short-term government bonds are expected to be suitable promising hedging tools that can replace stocks and bonds, and demand is also focusing on these ‘quality assets’ amid the declining value of money.
In particular, with consecutive interest rate hikes and global economic recession concerns leading to inflation worries, differentiation by region and product is becoming more distinct. Accordingly, demand is concentrating on products that offer various financial benefits to reduce the financial burden and also have the potential for value appreciation in the future.
Among these, there is high interest in premium residential products in the Gangnam area, where development prospects continue. Such premium residential products consistently have a supply shortage compared to demand in other regions, and their excellent product quality meets the discerning criteria of buyers.
Additionally, the fact that the ‘monthly rent era’ is becoming full-fledged in the housing lease market further raises expectations for premium residential products. The number of tenants who prefer paying monthly rent over taking out high-interest jeonse loans exceeding 4% annually is increasing, so high-end products are also expected to benefit.
In fact, looking at the status of ‘confirmed date’ registrations reported by tenants, the number of monthly rent cases reached 1,073,412 from January to September this year. Combined with last month’s reported cases (111,655), it exceeded one million for the first time. This is the highest annual record even before the fourth quarter statistics are added.
Meanwhile, ‘Eluke Seocho,’ located in the heart of the Gangnam area, is also attracting market attention. ‘Eluke Seocho,’ situated near the Gyodae Intersection in Seocho-gu, consists of two buildings from basement level 4 to ground level 23, with a total of 330 units in 12 different floor plans ranging from 19㎡ to 41㎡, including 1-room, 1.5-room, and 2-room types. It is gaining attention as a ‘reasonable high-end’ product offering various high-quality customized concierge services, secretary services, and community facilities.
In particular, compared to the sale prices of two-room floor plans in other premium residential products currently being sold in nearby areas, the sale price for the same floor plan at ‘Eluke Seocho’ is relatively low, around 1 to 1.1 billion KRW. Along with this, the product stands out with various financial benefits, including a 60% interest-free installment payment on the intermediate payment, no need for subscription savings accounts, and no loan restrictions, attracting high interest and positive responses from buyers.
Moreover, various global luxury brands fitting the value of high-end residential spaces have been introduced. The kitchen features the Italian luxury kitchen furniture brand ‘Cesar’ and Italian premium kitchen countertops ‘Roselin.’ For bathroom and kitchen faucets, the Italian high-end faucet brand ‘Gessi’ and Swiss intelligent sanitary ware company ‘Accent’ washbasins are applied, among other premium interior finishes.
The building exterior incorporates a vertical curtain wall facade design with stone details to create a unique style, and the 23-story high-rise design allows upper-floor units to enjoy city views of the Gangnam downtown area. Instead of neighborhood commercial facilities on the first floor, a hotel-style lobby space is designed to support residents’ convenience and privacy, and along with the community space ‘Luknity,’ various high-quality customized concierge services are provided.
Located in Seocho administrative town, near the Express Bus Terminal, Gangnam Station area, and the Seoul Arts Center, the site enjoys all major infrastructures of the Gangnam area with excellent transportation networks. It is a ‘triple station area’ complex with Gyodae Station and Nambu Terminal Station within about a 5-minute walk (500m), and Seocho Station within about a 10-minute walk (800m). It is also adjacent to transportation networks such as Seocho IC on the Gyeongbu Expressway, Banpo-daero, Seoripul Tunnel, and Nambu Sunhwan-ro, providing excellent accessibility by car.
Meanwhile, ‘Eluke Seocho’ is operating a sales gallery and is currently conducting non-priority contracts.
© The Asia Business Daily(www.asiae.co.kr). All rights reserved.
