"Even if You Have to Pay Double, It’s Still Worth It"... Why Are Dongtan Apartment Contracts Being Canceled One After Another?

[Financial News] As apartment prices in Dongtan New Town, Hwaseong, Gyeonggi Province, have risen rapidly on the back of the semiconductor boom, contract cancellations have increased sharply. With prices surging, it has become more profitable to return twice the deposit, which serves as compensation, and relist the property at a higher price.
According to the Ministry of Land, Infrastructure and Transport's Actual Transaction Price Disclosure System on the 21st, 82 apartment sale contracts in Dongtan District, Hwaseong City, were canceled as of last month. That is equivalent to 6.1% of the 1,355 contracts reported in May, already exceeding April's 47 cancellations.
Apartment prices are rising quickly amid reports that bonuses and in-house loans from Samsung Electronics and SK hynix will be released in large amounts. In fact, a 84-square-meter unit at Dongtan Station Lotte Castle, the area's flagship complex, changed hands for 2.225 billion won on the 4th, setting a new record high. Current asking prices are around 2.4 billion won. Based on actual transaction prices, that is about 400 million won higher than the 1.9 billion to 2 billion won range seen a month earlier.
Cheonggye-dong, near Dongtan Station, recorded the most cancellations with 28 cases, accounting for 34.1% of the total 82. Yeoul-dong, where the Lotte Castle complex is located, followed with 12 cancellations.
The price rally that began with new apartments in the Dongtan 2 New Town Dongtan Station Area is now spreading to nearby complexes. Apartments around Lake Park, known as "South Dongtan," are drawing attention as plans move forward for the Dongtan Urban Railway, which will connect to Dongtan Station. On the 7th, a 106.94-square-meter unit at Dongtan Lin Strauss The Lake in Song-dong was contracted for 1.5 billion won, setting another record high. That is more than 100 million won higher than a month earlier.
Another reason demand is pouring in is that the area has not yet been designated as a land transaction permit zone, making gap investment possible. The current permit zones cover all of Seoul and 12 areas in Gyeonggi Province. Unlike those areas, Dongtan still has no requirement for owner occupancy.
Even if it is designated as a permit zone, however, it remains unclear whether prices will fall. A real estate industry official said, "Since a large amount of liquidity from the semiconductor sector is expected to be injected, there will still be demand to buy homes."
kjh0109@fnnews.com Kwon Jun-ho Reporter