Apartment prices in Bundang, a planned district south of Seoul long known as the next-best address after Gangnam, are climbing sharply. The area sits along commuting routes for Samsung Electronics and SK hynix employees, served by company shuttle buses and subway stations, and expectations for apartment rebuilding projects have added to buying sentiment.
An 84-square-meter unit at Park Town Samik in Sunae-dong, Bundang-gu, Seongnam, sold for a record 2.37 billion won ($1.64 million) on Sept. 21, according to the Ministry of Land, Infrastructure and Transport's transaction disclosure system on the 23rd. That was 320 million won above the previous sale. A comparable 84-square-meter unit at nearby Park Town Lotte traded at 2.1 billion won on Sept. 15, up 250 million won, while an 84-square-meter unit at Sibeom Hyundai in Seohyeon-dong sold for 2.17 billion won, clearing the 2 billion won mark.
An 84-square-meter unit at Yangji Village Kumho No. 1 in Sunae-dong set a new high of 2.445 billion won on Sept. 5, approaching 2.5 billion won. An 84.96-square-meter unit at Cheongsol Village Seogwang-Yeongnam in Geumgok-dong, completed in 1995, changed hands at 1.97 billion won on the 17th, 70 million won above its April record of 1.9 billion won.
The gains show up in the data. The average apartment sale price in Bundang-gu rose 21.6% to 1.785 billion won in September from 1.468 billion won a year earlier, according to the Korea Real Estate Board, and the district's sale price index has risen for 19 straight months.
A separate analysis by property platform Zigbang of nationwide prices from September last year through August this year put Bundang-gu's increase at 29.5%, the highest among all cities, counties and districts in the country. The two figures differ because they are calculated on different bases.
Buyers Trade Up Along the Chip Belt as Outsiders Account for Half of Purchases
What is underpinning Bundang prices is demand from outside the district. Of 9,385 people who bought units in multi-unit (condominium-style) buildings in Bundang in the first nine months of this year, 50.17%, or 4,708, lived elsewhere, according to the Supreme Court's registry information service. Purchases by residents of Hwaseong totaled 371, up 39.0% from the same period a year earlier, while buyers from three areas including Yongin's Giheung-gu and Suwon's Yeongtong-gu rose 27.1% to 991 from 780.
The shift is read as buyers trading up to a more desirable area, choosing Bundang for its school districts and amenities at a lower entry cost than Gangnam. Behind it lies the semiconductor boom. Samsung Electronics in May ratified a wage agreement setting aside 10.5% of the device solutions division's business performance as a bonus pool, while SK hynix allocates 10% of operating profit for bonuses.
Analysts say rising liquidity among employees, along with greater capacity to draw on in-house housing loans, could add further upward pressure on prices in prime areas of southern Gyeonggi Province.
Rebuilding expectations have lifted prices at older complexes. On Sept. 29, Seongnam designated five zones — Imaechon No. 1, Sibeom Complex No. 1, Park Town, Pureun Village and Hansol Village No. 2 — totaling 13,429 units as candidates for special redevelopment zone status this year. Four earlier-designated leading districts — Yangji, Sibeom, Saetbyeol and Mongnyeon villages — covering 20,413 units have completed the appointment of project operators and are preparing follow-up procedures.
Ahead of the designation announcement, a 59-square-meter unit at Pureun Village Ssangyong in Sunae-dong sold for 1.575 billion won on Sept. 2, up 405 million won from 1.17 billion won a year earlier, while a 134-square-meter unit at Park Town Daelim traded at 2.6 billion won on Sept. 5, 310 million won above its level in August last year. Smaller units also jumped. A roughly 48.51-square-meter unit at Yangji Village Complex No. 5 in Sunae-dong recently sold for 1.7 billion won, or about 100 million won per 3.3 square meters, and a 35.1-square-meter unit at Sibeom Hanyang in Seohyeon-dong traded at 1.4 billion won in August.
Bundang is drawing rebuilding expectations, money from the semiconductor boom and trade-up demand at the same time, diverging from the cooling seen in the Gangnam area. With out-of-district buyers accounting for more than half of purchases, the chip industry's performance and the pace of rebuilding are expected to be the variables for prices ahead.