Housing prices in new towns in the Seoul metropolitan area have been rapidly recovering in the first half of the year. In particular, among the second-generation new towns, housing prices in Dongtan 2 New Town led the price recovery by rising more than 16%. However, Zigbang judged that it is difficult to say that investment demand has revived, citing the slow recovery of apartment prices in relatively affordable areas such as Hangang and Yangju New Towns.
Zigbang analyzes apartment sale prices in Seoul metropolitan new towns... Highest price per 3.3㎡ is 44.01 million KRW in Pangyo
According to the analysis of apartment sale prices in new towns in the Seoul metropolitan area using Zigbang's proprietary AI big data solution 'Zigbang RED', as of June this year, the highest prices among the metropolitan new towns were found in Seongnam Pangyo New Town. The price recorded was 44.01 million KRW per 3.3㎡ of supply area, which translates to approximately 1.49 billion KRW for a 34-pyeong apartment, commonly known as the standard size.
Following were the southeastern residential districts such as Wirye (34.97 million KRW/3.3㎡), Bundang (34.39 million KRW/3.3㎡), and Gwanggyo (30.56 million KRW/3.3㎡). Among other areas, Pyeongchon New Town and Dongtan 2 New Town formed relatively high price ranges at 24.53 million KRW and 22.65 million KRW per 3.3㎡ respectively. Apartments in other first and second-generation new towns all showed prices below 20 million KRW per 3.3㎡.
In the first-generation new towns, price fluctuations over the past three years were significant in relatively affordable areas such as Sanbon and Jungdong districts. Especially in Sanbon, which experienced the largest rise and fall since the second half of 2020, prices have dropped about 25.5% from the peak in September 2021 (109.2p) to the current level.
On the other hand, Bundang, which has relatively high price levels, showed smaller price fluctuations during the same period but has been rising relatively quickly this year compared to other first-generation new towns. The provisional apartment price index for Bundang rose about 8.7% from the low point in December 2022 to June 2023.
Zigbang explained, "Areas like Bundang and Pangyo, which had relatively high apartment price levels and were subject to various regulations, showed smaller price fluctuations during the low-interest period. In contrast, relatively affordable areas saw rapid price increases due to concentrated investment demand, but prices fell quickly again due to last year's interest rate hikes."
Compared to this, other first-generation new towns showed relatively slow price recovery, with increases in the order of Pyeongchon (3.7%), Sanbon (1.8%), Jungdong (1.3%), and Ilsan (0.7%).
Highest increase among new towns... Dongtan 2 New Town shows the highest housing price growth rate in the first half
Among the second-generation new towns, comparing the five southeastern new towns with relatively high price levels, Dongtan New Town, which has relatively lower prices, showed the largest price fluctuations since 2020. In contrast, Pangyo New Town, which has the highest price levels, showed smaller fluctuations. All five districts peaked in September 2021, then sharply declined to a low point in December last year, and since then, prices have recovered relatively quickly compared to other new towns this year. Based on the provisional price index increase rate from December 2022 to June 2023, Dongtan 2 New Town showed the highest increase among southeastern second-generation new towns with a 16.8% rise over six months. It was followed by Gwanggyo (11.6%), Wirye (10.4%), Pangyo (8.8%), and Dongtan 1 (8.6%).
In the northern second-generation new towns such as Yangju, Unjeong, and Hangang New Towns, rapid price increases were commonly observed in the second half of 2020. After peaking in October 2021, prices turned downward and experienced significant declines last year, especially in Yangju New Town, where the decline during the downturn was very large. These areas also showed relatively slow price recovery in the first half of 2023 compared to southeastern second-generation new towns. Based on the provisional price index from December last year to June this year, the increases were in the order of Yangju (8.0%), Unjeong (6.7%), and Hangang (4.0%).
Recently occupied new towns such as Geomdan and Godeok International New Towns have shown different price trends compared to other areas. Geomdan experienced rapid price declines immediately after occupancy due to the real estate downturn but, unlike nearby Hangang New Town, began rebounding relatively early around October last year. As of June this year, the price index was recorded at 97.7p, rising nearly 16.5% compared to December last year, almost recovering last year's price levels. Godeok forms a separate market from other Seoul suburban new towns, showing relatively rapid price increases after occupancy in 2020 due to good accessibility via the SRT Pyeongtaek Jije Station and favorable factors such as the Samsung Electronics Pyeongtaek Campus. Even during last year's real estate downturn, the price decline was small.
Zigbang analyzed, "Unlike the real estate boom period (2020-2021), the slower price increases in affordable apartments in areas like Hangang and Yangju New Towns suggest that it is difficult to interpret the current phase as a revival of investment demand as in the past."
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