As the occupancy of 'Olympic Park Foreon' in Dunchon-dong, Gangdong-gu, Seoul, which has about 12,000 households, is becoming more pronounced, the impact is being felt in the local apartment rental market. The rental prices of nearby apartments in areas like Goddeok and Sangil are falling by several hundred million won.
According to Big Data Platform Asil on the 13th, the number of rental listings for Olympic Park Foreon stands at 4,232 as of that day. There are 2,784 rental listings and 1,448 monthly rental listings. Until early September, rental listings remained in the low 3,000s, but the availability is increasing as the occupancy date approaches. However, it has been confirmed that there is no significant change in price ranges. It is difficult to find listings priced below 1 billion won for 84 square meters. The occupancy for Olympic Park Foreon began on the 27th of last month.
A representative from a real estate agency in Dunchon-dong, Gangdong-gu, noted, "There is a high demand for actual occupancy, so we cannot say that the number of rental listings is high for typical occupancy levels," adding, "For 84 square meters, the pricing for the larger units, 2nd and 3rd complexes, is set between 1 billion and 1 billion 300 million won."
The occupancy of Olympic Park Foreon is impacting the overall rental market in Gangdong-gu. In particular, prices are falling significantly for newly built large complexes where high-priced rental contracts were signed 3 to 4 years ago.
In the case of 'Goddeok Lotte Castle Bene Luce (1,859 households),' which began occupancy in December 2019, a lease for 84 square meters was contracted at a price drop of around 800 million won from the previous highest price. The highest rental price for this apartment was set at 1.42 billion won (26th floor) on December 12, 2020, but on the 1st of this month, it transacted for 530 million won (6th floor), and on the 10th, it transacted for 598.5 million won (24th floor), reflecting transactions in the 500 to 600 million won range. Currently, online rental listings price is also around the low 600 million won level.
'Goddeok Jaye (1,824 households)' in Sangil-dong has also seen a significant drop in rental prices. This apartment, which opened in January 2021, transacted at 624.75 million won (3rd floor) on the 30th of last month, a drop of 605.25 million won from the peak rental price of 1.23 billion won (13th floor) recorded in April 2021. Similarly, the 84 square meters of 'Goddeok Artion (4,066 households)' in Sangil-dong also transacted at a price 510 million won lower than the peak price of 1.2 billion won (22nd floor) recorded in April 2021, with two transactions occurring at the end of November.
A representative from a real estate agency in Sangil-dong stated, "Among the recent transactions, some were renewal contracts that resulted in significantly lower price levels," but added, "The impact of Olympic Park Foreon cannot be ignored."
Yoon Ji-hae, chief researcher at Real Estate R114, noted, "Looking at Seoul as a whole, the impact of Olympic Park Foreon’s occupancy can be seen as minimal," but added, "However, given that it attracts demand from several thousand households, there could be an impact in the Songpa and Gangdong areas."
Meanwhile, while Seoul's apartment rental prices are on the rise, rental prices in Gangdong-gu have shown a declining trend for five consecutive weeks. According to the Korea Real Estate Agency, as of the 9th, apartment rental prices in Gangdong-gu fell by 0.05% compared to the previous week. The rental prices in Gangdong-gu have been on the rise until the second week of August (as of the 12th) but have sustained a downward trend since the second week of November (as of the 11th).