With Real Estate Indicators Recovering, 'Bottoming Out' Theory of House Prices Emerges... 'ePyeonhansesang Gunsan Diocean Luce' Draws Attention

- In April this year, the local actual transaction price index rose by 0.4p compared to the previous month, marking three consecutive months of increase since February
- With the recovery of real estate indicators, the 'bottoming out' theory of house prices emerges... Demand for new apartments increases

Following Seoul, the local real estate market is also showing signs of recovery, with buyers becoming increasingly active. Transaction volumes are rising, the actual transaction price index is on an upward trend, and complexes receiving subscription applications are recording high competition rates.

According to the Korea Real Estate Board, the number of apartment sales transactions in local areas (excluding the metropolitan area) in May this year totaled 23,658, marking the highest level since May last year’s 25,569 transactions. This figure is more than double the 11,509 transactions recorded in January this year.

The actual transaction price index, which is considered a relatively accurate statistic as it counts only reported transaction cases, is also on the rise. According to the Korea Real Estate Board, the apartment actual transaction price index in local areas (excluding the metropolitan area) was 107 in April this year, up 0.4 points from the previous month. This marks three consecutive months of increase since a 0.41-point rise in February.

Industry experts analyze that the perception that the market has "hit bottom" is spreading, leading to increased apartment buying activity. The easing of real estate regulations implemented earlier this year and recent stabilization of interest rates appear to have contributed to this trend. Additionally, as future price increases are inevitable, demand for new complexes is expected to grow.

Data from Real Estate R114 shows that in the second quarter of this year (April to June 2023), the average competition rate for first-priority subscriptions in local areas excluding the metropolitan area was 9.12 to 1, a significant increase from 5.35 to 1 in the previous quarter (January to March 2023). Notably, the number of first-priority applicants nearly doubled to 82,359 compared to 46,388 in the same period.

The subscription fever was intense even in individual complexes. In May this year, the ‘Shinyoung Ziwell Prugio Technopolis Central’ in Cheongju, Chungbuk, recorded an average first-priority competition rate of 73.75 to 1, with 34,886 applications submitted for 473 households (excluding special supply). Following that, in June, ‘Gyodae Station Moa Elga Grande’ in Dong-gu, Gwangju, received 4,337 applications for 336 households (excluding special supply), resulting in an average first-priority competition rate of 12.91 to 1.

An industry expert said, “As the local real estate market, which had been declining, shows signs of rebound following Seoul, the perception that now is a good time to buy is growing. Since pre-sale prices are expected to rise further, demand for new complexes offered before the increase is likely to increase.”

Meanwhile, among new complexes in Gunsan, Jeonbuk, a project with excellent location and competitive pricing is attracting attention. Currently, DL E&C is offering the ‘e-Pyeonhansesang Gunsan Diocean Luce’ on a first-come, first-served basis, located near Diocean City, one of the most preferred areas in Gunsan.

Diocean City is composed entirely of brand complexes from the top 10 construction companies and has established itself as Gunsan’s representative residential town with various educational and cultural facilities, including Lotte Mall Gunsan, the largest shopping facility in Jeonbuk.

Moreover, various development benefits are expected, enhancing its future value. According to the Saemangeum Development Agency, the Saemangeum National Industrial Complex is emerging as a hub for the secondary battery industry, achieving corporate attraction results totaling 6.6 trillion KRW from May last year to the present (June). The number of direct jobs in Jeollabuk-do reached 6,301, nearly three times the 2,202 jobs created over nine years since the agency’s establishment. Recently, with the official designation of the Saemangeum National Industrial Complex as an investment promotion zone, internal development and corporate investment are expected to accelerate.

Additionally, the ‘Triport’ is being developed around the Saemangeum area in Gunsan to establish a logistics network for resident companies, including a port, airport, and railway. This will include the Saemangeum Port, the private Saemangeum Airport, and a railway network connecting to KTX Iksan Station. Once completed, it is expected to attract a population influx of approximately 700,000, significantly increasing the residential population.

e-Pyeonhansesang Gunsan Diocean Luce is expected to benefit from its proximity to the newly developing Saemangeum New Port. The Gunsan General Industrial Complex, home to 67 companies including CJ CheilJedang Gunsan Plant, and the Gunsan National Industrial Complex with 210 companies such as Hyundai Doosan Infracore Gunsan Plant, as well as the Gunsan 2 National Industrial Complex with 629 companies, provide convenient commuting options.

Various financial benefits are also offered. A 60% interest-free benefit on interim payments is provided, so even if interest rates rise later, there is no impact on interest burden. Additionally, the contract deposit can be paid in three installments: 5 million KRW for the first, 15 million KRW for the second, and the remaining balance for the third. Especially, interest support is provided for the third installment, allowing buyers to secure their home with a total of 20 million KRW without worrying about additional costs until move-in. As these benefits are offered for a limited time, demand from buyers eager to seize the opportunity continues.

Meanwhile, e-Pyeonhansesang Gunsan Diocean Luce consists of 8 buildings ranging from 2 basement floors to 29 above-ground floors, with a total of 800 households ranging from 84 to 155㎡ in exclusive area, and is scheduled for move-in in July 2025.