Seoul's jeonse crunch is spreading to key areas in Gyeonggi Province. As the burden of Seoul apartment jeonse prices grows, demand is shifting to Gyeonggi areas with good access to Seoul, including Gwangmyeong, Hwaseong Dongtan, Suwon Yeongtong, Anyang Dongan, and Yongin Giheung. With listings shrinking and demand rising, apartment jeonse prices in Gwangmyeong and Dongtan have climbed more than 8% so far this year.
According to weekly apartment price trends for the fifth week of June (as of June 29) that the Korea Real Estate Board (REB) released on the 5th, five of the top 10 regions nationwide with the largest jeonse price increases from the end of last year were in Gyeonggi. Seoul Seongbuk District posted the highest rise at 8.21%, followed by Gyeonggi Gwangmyeong (8.11%) and Gyeonggi Hwaseong Dongtan District (8.03%). Gyeonggi Suwon Yeongtong District (6.82%), Anyang Dongan District (6.73%), and Yongin Giheung District (6.21%) also ranked near the top.
A drop in listings is behind the rapid rise in Gyeonggi apartment jeonse prices. According to real estate big data platform Asil, as of the 3rd, Gyeonggi apartment jeonse listings stood at 12,410, down 31.3% from 18,056 at the end of last year. The decline was particularly sharp in Gwangmyeong. Over the same period, jeonse listings in Gwangmyeong plunged 83.4% from 1,722 to 286. Gyeonggi Guri also saw jeonse listings fall 68%.
It is hard to find jeonse listings even in large complexes. By Asil's count, Gwangmyeong Cheolsan-dong "Cheolsan Raemian Xi," a large complex with 2,073 households, has no registered jeonse listings. Nearby "Gwangmyeong e-Pyunhansesang Centreville," with 2,815 households, had only one registered jeonse listing. An employee at a certified real estate agency in Cheolsan-dong said, "Last year, as move-ins continued at large complexes in Gwangmyeong that had completed reconstruction, a batch of jeonse supply came on the market, but most of it was absorbed," adding, "Now supply is thinning and jeonse prices are rising quickly."
More people are also moving from Seoul to Gyeonggi. According to the Ministry of Data and Statistics (MODS), from January to May this year, 131,195 people moved from Seoul to Gyeonggi Province, up 11% from 118,112 during the same period last year. Analysts say jeonse demand is growing as tenants who can no longer afford Seoul jeonse move to Gyeonggi areas with relatively good access to Seoul.
A decline in move-in supply is also cited as a factor worsening the jeonse crunch. According to Real Estate 114, Seoul apartment move-ins this year total around 18,000 households, about half of last year's level, and Gyeonggi is about 50,000 households, the lowest in 11 years. With fewer move-ins to new apartments, jeonse supply also drops, which could keep jeonse supply-demand tight in both Seoul and Gyeonggi.
Nam Hyeok-woo of the Woori Bank Real Estate Research Institute said, "As tenants feeling the jeonse burden in Seoul move to Gyeonggi areas with good transportation access, jeonse demand is concentrating," adding, "With the impact of reduced move-in supply layered on, jeonse prices are rising in key Gyeonggi regions."