Within a Month, 500 Million Won Drop... Dongtan Housing Prices Boosted by GTX Also Declined

GTX Led Housing Prices in Dongtan New Town
Multi-Billion Won Price Drops from Outskirts
Apartment Prices' Weekly Increase Narrows for 4 Consecutive Weeks

After overcoming the housing market slump and a surge in record-high prices, house prices in Dongtan New City are now on a downward trend. Due to the continued high interest rates and loan regulations, buying demand has weakened, causing the house prices along the railway in Dongtan to experience sharp fluctuations.

Dongtan New Town Panorama (Asia Economy DB)

According to the Ministry of Land, Infrastructure and Transport's real transaction price system on the 5th, the 116㎡ unit of Dongtan Rhine Strauss The Lake in Songdong, Hwaseong City, Gyeonggi Province, classified as Namdongtan because it borders Osan, was brokered for 2 billion KRW (22nd floor) in early October. However, the same size unit changed hands for 1.5 billion KRW (26th floor) and 1.3 billion KRW (2nd floor) last month, dropping more than 500 million KRW in just one month.

The 113㎡ unit of Dongtan Station Shibeom Hanwha Dream Green Prestige in Cheonggye-dong, Hwaseong City, also welcomed a new owner for 1.358 billion KRW (6th floor) on the 15th of last month, which is over 100 million KRW lower compared to the 1.5 billion KRW transactions on August 16 (6th floor) and September 12 (4th floor).

The 73㎡ unit of Dongtan Station Bando Yubora Ivy Park 8.0 in Osandong was traded for 930 million KRW (13th floor) on the 18th of last month, down 90 million KRW from 1.02 billion KRW (29th floor) on October 12. The common factor among these areas where prices have dropped by hundreds of millions of KRW is that they are complexes difficult to reach on foot from the GTX, which had driven up Dongtan house prices. As the housing market cools, Dongtan is also showing a pattern of prices falling from the outskirts.

However, complexes that can directly benefit from transportation developments are holding firm with record-high prices. The 84㎡ unit of Dongtan Station Lotte Castle (mixed-use complex), just a one-minute walk from the GTX-A line, recorded a new high at 2.1 billion KRW in September. Asking prices are formed in the 1.6 to 1.8 billion KRW range, and there have been no transactions so far.

The Dongtan area has led the rebound in apartment prices in Hwaseong City, Gyeonggi Province, driven by the market recovery and the early opening of the metropolitan area express railway (GTX). However, with the reduction of special home loan programs, strengthened loan regulations, and the continuation of high interest rates, the housing market has recently contracted, and Dongtan appears to have entered a price adjustment phase.

Indicators that gauge market conditions are also worsening. According to the Korea Real Estate Board, the Gyeonggi Province sales supply-demand index, which reflects buyer sentiment, was 89.4 as of the fourth week of last month (November 27), down 0.3 points from the previous week (89.7). The Gyeonggi sales supply-demand index, which had fallen to 67.2 earlier this year and rose above 90 at the end of August, has been declining since last month. This index quantifies supply and demand, and a value below the baseline (100) means there are more sellers than buyers in the market.

During the same period, the weekly apartment price trend survey showed that apartment prices in Hwaseong, which includes Dongtan New City, recorded a 0.25% increase in the fifth week of October, but the rate of increase has narrowed for four consecutive weeks, resulting in only a 0.05% rise this week.