Rising Loan Interest Rates Draw Attention to 'Interest-Free Interim Payments' Apartments

Rising Mortgage Loan Rates at Commercial Banks Increase Burden
Construction Companies Target Buyers with Interest-Free Interim Payments and More

Apartments offering interest-free interim payments are gaining attention in the sales market. This is due to the increased burden on homebuyers caused by high interest rates and rising construction costs. In response, construction companies are targeting buyers by promoting financial benefits such as interest-free interim payments.

According to the finance and real estate industries on the 4th, bank loan interest rates, which had been stagnant for a while, are rising again. The variable mortgage loan interest rates of the five major commercial banks?KB Kookmin, Shinhan, Hana, Woori, and NH Nonghyup?were recorded at 4.08% to 6.937% based on the new COFIX rate that day. The lower end rose to the 4% range, and the upper end approached 7%.

'Harrington Place Jinsa Bird's-eye View.'

As loan interest rates rise, more buyers are showing interest in financial benefit conditions that reduce their financial burden. The most representative financial benefit is 'interest-free interim payments.' In a situation where buyers' interest burdens are increasing, construction companies bear the interest on interim payments, which account for 40-60% of the sales price, as long as buyers pay only the apartment deposit.

First, ‘Haerington Place Jinsa,’ currently being sold right in front of Pyeongtaek University in Anseong, Gyeonggi-do, is attracting attention by offering full interest-free interim payments and increased free options. This complex consists of 12 buildings ranging from 2 basement floors to a maximum of 29 floors above ground, with a total of 992 households. It offers full interest-free interim payments and first-come, first-served unit selection conditions.

Additionally, when expanding the balcony, various options such as ceramic tiles on kitchen walls and countertops, microwave ovens, square sinks, lighting in the living room and kitchen, and corridor and living room sheet panel finishes are provided free of charge. For contract holders, an event is also underway offering paid options such as entrance doors and auxiliary kitchen furniture as complimentary gifts.

Anseong was recently designated as a specialized complex for materials, parts, and equipment (Sobu-jang), and it also benefits from development prospects with the creation of the world's largest semiconductor cluster connecting Yongin, Pyeongtaek, and Anseong.

A sales representative for Haerington Place Jinsa said, “The biggest advantage is that you can purchase a new home with interest-free interim payments in the 400 million KRW range,” adding, “Since the announcement of the Anseong development plan and interest rate hikes, visits to the model house have noticeably increased.”

‘Hillstate Sokcho,’ currently being sold in Geumho-dong, Sokcho-si, Gangwon-do, also promotes a fixed deposit system and interest-free loans on 60% of the interim payments. This complex consists of 11 buildings ranging from 3 basement floors to 25 floors above ground, with a total of 925 households.

‘Wonju Dongmun The East,’ located in Gwanseol-dong, Wonju, Gangwon-do, offers financial benefits such as interest-free interim payments and a fixed deposit system, while ‘Asan Xi Grand Park’ in Yonghwa-dong, Asan, Chungnam, offers full interest-free interim payments, a 5% deposit (for exclusive areas over 84㎡), and first-come, first-served unit selection conditions.

Additionally, ‘Wanggil Station Kumho Eoullim Edugreen’ in Seo-gu, Incheon, and ‘La Pent Hill’ in the Cheomdan district of Gwangju Metropolitan City also provide interest-free interim payment benefits and free options.

A real estate industry official advised, “There are often cases where contracts are difficult due to soaring interim payment loan interest rates for newly sold apartments,” adding, “Interest-free interim payments are a very good benefit for actual buyers, but it is also important to carefully examine nearby development plans, complex size, and various convenience facilities.”