As newlywed hope town complexes that took advance subscriptions five years ago move into the main subscription phase, sale prices have risen more than 30% from what was expected at the time. With increases in raw material prices and labor costs reflected, prices have jumped by hundreds of millions of won, adding to the burden on advance subscription winners. Winners at complexes that have not yet posted main subscription notices are filing complaints with the Korea Land & Housing Corporation (LH) and others, asking to reduce the scale of the price hikes.
According to the industry on the 9th, LH has recently been proceeding in sequence with main subscriptions for newlywed hope town complexes that conducted advance subscriptions around 2021. With about five years elapsing from advance to main subscription, some complexes saw sale prices far exceed the estimates at the time.
On May 29, the newlywed hope town at Seongnam Nakseong A-1 block in Gyeonggi, e-Pyeonhansesang Bundang First Village, posted a tenant recruitment notice, setting sale prices for exclusive areas of 51–59 square meters at 555.31 million–682.72 million won. The estimated prices at the time of advance subscription were 452.11 million–515.69 million won. Based on the 59-square-meter type, the price rose 32.4% from 515.69 million won to 682.72 million won.
The newlywed hope town at Bucheon Yeokgok A-2 block, Yeokgok District Howstory, which posted a tenant recruitment notice on the 26th of last month, shows a similar pattern. The sale price for the 55-square-meter exclusive type was set at 476.8 million–507.6 million won. Compared with the estimated 389.05 million won at the time of the advance subscription five years ago, that is an increase of up to 30.5%.
As main subscription prices come in higher than expected, winners at complexes that have not yet posted notices are also moving. Advance subscription winners at Seongnam Bokjeong 2 A-1 block, where the main subscription is scheduled for the end of this month, are said to have recently conveyed to LH and related agencies a request to minimize the scale of the price hikes. They acknowledge that construction cost increases are inevitable due to higher material costs, but argue that since there is also public responsibility for the delay to the main subscription, the burden on winners should be reduced.
The Seongnam Bokjeong 2 A-1 block's project period is said to have been extended by 4 years and 2 months beyond plan. Accordingly, the total project cost increased by 279.3 billion won, from 489.5 billion won to 768.8 billion won. As project costs have risen, main subscription prices are likely to climb substantially above the estimates at the time of the advance subscription.
An advance subscription winner at this complex said, "I heard that as prices at other newlywed hope town complexes came in higher than expected, some people even gave up on the main subscription," adding, "Once the tenant recruitment notice is posted, it is hard to adjust prices, so we conveyed our views before the notice asking to lower the price even a little."
The issue of rising prices due to delays between advance and main subscriptions had already surfaced at Incheon Gyeyang A-2 and A-3 blocks. At the time, as main subscription prices rose about 20% above the estimates at the time of the advance subscription, some winners gave up their contracts.
As controversy grew, LH also said it would shoulder the expense burden stemming from the delay to the main subscription. Then-LH President Lee Han-joon said at a full meeting of the National Assembly's Land Infrastructure and Transport Committee on Nov. 7, 2024, "Because the standard construction cost rises by the time of the main subscription, the increase in sale prices is something those who made advance subscriptions have to bear," but added, "LH will cover the losses arising from delays to the main subscription schedules that were announced at the time of the advance subscription."