'W1.7b for a Bucheon apartment?' High pre-sale prices spread across Greater Seoul

"I knew it would be a sensation — it's the first new apartment in Bucheon in over a decade — but the price is on par with new Seoul developments. High pre-sale prices seem to be spreading into the wider metropolitan area," said a real estate agent near Bucheon.

A shortage of new apartment supply, combined with rising raw material and labor costs, is pushing high pre-sale prices across Greater Seoul. In Bucheon, Gyeonggi Province, at least one new apartment complex has now priced its standard 84-square-meter unit above 1.6 billion won ($1.13 million).

According to the Korea Real Estate Board's apartment subscription platform, Lotte Engineering & Construction opened the show home for Sangdong Station Lotte Castle Signature on Friday and launched its resident recruitment announcement.

The complex is being built on the former Homeplus Sangdong store site and will comprise seven buildings rising from eight basement floors to 49 above-ground floors, with a total of 1,859 units. The development is notable for its mid-to-large unit mix: 1,370 units at 84 square meters, 308 units at 113 square meters, 178 units at 121 square meters, and three penthouse units at 153, 187 and 192 square meters.

The pre-sale prices stand out for being far above those of nearby complexes. According to the resident recruitment announcement, the 84-square-meter units are priced between 1.4 billion won and 1.64 billion won. When balcony expansion and optional upgrades are factored in, the top price for that unit type is estimated to reach around 1.7 billion won. Larger units and penthouses are listed at between 2.1 billion won and 6.04 billion won.

Those figures are comparable to new apartment pre-sale prices in Seoul during the first half of this year. The 84-square-meter units at The Sharp Singil Central City — a redevelopment of the Singil District 3 zone in Yeongdeungpo-gu — were offered at around 1.89 billion won in March. The same unit type at Jangwi Prugio Mark One, a redevelopment of the Jangwi District 10 zone in Seongbuk-gu, was priced at around 1.7 billion won.

Pre-sale research firm Real House analyzed Korea Real Estate Board apartment subscription data and found that the average pre-sale price for 84-square-meter units in Gyeonggi Province stood at 950.25 million won as of July, up 1.3 percent from the previous month and 18.6 percent from the same month last year. Rising construction costs and soaring Seoul pre-sale prices are driving the high-price trend into the surrounding metropolitan area.

Sangdong Station Lotte Castle Signature's pre-sale prices are nearly 1.5 times the Gyeonggi Province average, yet interest in the complex was strong even before the announcement. About 5,000 visitors came through the show home on Friday alone, its opening day. Industry observers expect the complex to draw strong subscription competition, as it is the first new apartment supply in Bucheon in roughly a decade.

"It is a transit-oriented development right next to Exit 1 of Sangdong Station on Line 7, which offers easy access to Gangnam, and by car residents can reach the Seoul Ring Expressway and the Gyeongin Expressway via the Jungdong interchange," a pre-sale industry official said. "The area is also close to a well-known hagwon district, and Hyundai Department Store Jungdong, Newcore Outlet Bucheon and Lotte Department Store Jungdong are all nearby — many homemakers showed strong interest at the pre-launch briefings."