Soaring Officetel Prices Due to Apartment Regulations... Growing Interest in New Officetels

This year, the price increase rate of officetels has surpassed that of apartments, drawing the attention of buyers toward officetels. This is attributed to the concentration of regulations on apartments and the rising housing prices, which have driven purchasing demand toward officetels. As a result, newly launched officetels are attracting interest.

According to data from the Korea Real Estate Board, the average sale price of officetels nationwide in February this year rose by 15.16% compared to the same month last year (February 2020). In contrast, the average sale price increase rate for apartments nationwide during the same period was only 9.35%. In the metropolitan area, officetels increased by 13.72%, while apartments rose by 9.22%.

Industry experts consider it unusual that the price increase rate of officetels has exceeded that of apartments. Most officetel investments are made for rental income purposes, but due to recent strengthened regulations in the apartment market, demand has shifted to officetels as an alternative investment option.

In fact, the transaction volume of officetels is also increasing. According to the Korea Real Estate Board, last year’s nationwide officetel transaction volume was 161,642 cases, about a 7.85% increase compared to 149,878 cases in the same period the previous year (2019).

Experts predict that from this year, as tax increases on multi-homeowners expand, buyers who previously purchased apartments for investment purposes will turn their attention to officetels, which have relatively lower regulatory burdens. Officetels are relatively free from various regulations compared to apartments, such as loans, taxes, and resale restrictions.

For example, officetels can apply a loan-to-value ratio (LTV) of up to 70%, unlike apartments. Also, winning a subscription for an officetel does not count toward the number of houses owned, allowing buyers to maintain their status as non-homeowners. The pre-sale rights are not included in the calculation of acquisition tax and capital gains tax on houses. The capital gains tax rate on pre-sale rights is also applied at the basic rate (6~45%, with a holding condition of over 2 years).

Meanwhile, new officetels are being supplied, attracting investors’ attention. Daelim Construction Co., Ltd. and Daelim Corporation Co., Ltd. are currently selling ‘e-Pyeonhansesang City Bupyeong Station’ in the Bupyeong district of Incheon. This complex consists of three buildings from basement level 6 to ground level 20, with 1,208 officetel units ranging from 23 to 41㎡ in exclusive area, 156 office units on the 2nd and 3rd floors, and 18 neighborhood living facilities on the 1st floor. It is the largest branded officetel in Bupyeong and includes section offices, currently available for sale.

This complex is a triple transfer station complex within walking distance of Bupyeong Station, which serves Seoul Subway Line 1, Incheon Metro Line 1, and the planned GTX-B line. Located near the large commercial district around Bupyeong Station, residents can access shopping and convenience facilities such as Lotte Mart, Bupyeong Station underground shopping mall, 2001 Outlet, and Moda Department Store.

The officetel units come fully furnished with washing machines, refrigerators, and system air conditioners. Even the small-sized units with an exclusive area of 23㎡ provide built-in storage spaces, including a pull-out laundry drying rack. The complex applies cutting-edge IoT and solar power systems for a convenient living environment and energy savings, and it also features a fitness center for healthy leisure activities within the complex.

For the office units, section offices provide exclusive balcony service areas to maximize workspace utilization. They come standard with heating and cooling systems, ventilation systems (heat exchange), and digital door locks for a comfortable working environment. Additionally, car-sharing services using shared vehicles in the parking lot will be provided, along with rental management services that handle vacancies and complaints on behalf of landlords, and concierge services that process residents’ requests through an agency.

Furthermore, since it is not subject to regulations, resale of pre-sale rights is possible, and benefits such as a 10% down payment and full interest-free installment payments are offered.

This content was produced with the assistance of AI translation services.