Local Housing Market: Are Branded Apartments Leading the 'Cheongyak' Market?

The popularity of brand-name apartments, which had been prominent mainly in Seoul and the metropolitan area, has recently intensified even more in the provinces. With the high symbolic value of the brand itself and the added rarity within the region, a strong demand base is forming in the provincial pre-sale market.

Brand-name apartments constructed by major construction companies boast excellent product qualities based on their accumulated construction experience, including the latest floor plans, finishing materials, and community facilities. Additionally, they show strengths in various aspects such as providing after-sales management and services for a certain period after move-in, further increasing consumer preference.

According to data from Real Estate 114 (as of June), among complexes pre-sold this year (January to May) outside the metropolitan area, brand-name apartments by the top 10 construction companies in the construction capability evaluation totaled 8,498 units (excluding special supply). There were 172,655 applications submitted for these units alone, recording an average competition rate of 20.32 to 1 for first-priority applicants.

In contrast, during the same period, other apartments received 209,227 applications for 26,918 units (excluding special supply), showing an average competition rate of 7.77 to 1 for first-priority applicants. Although these accounted for about 76% of the total supply (35,416 units), the competition rate was about three times lower than that of brand-name apartments.

Looking at the regions, the popularity of brand-name apartments stands out even more. For example, among six complexes pre-sold in Gwangju Metropolitan City this year (January to May), the only brand-name apartment, Hyundai Construction’s ‘Hillstate Gwangcheon’ (pre-sold in March 2021), recorded the highest competition rate in the region this year with an average of 33.31 to 1 for first-priority applicants. This is more than twice the competition rate of non-brand complexes, which was 14.74 to 1.

Also, among complexes pre-sold in North Jeolla Province this year, POSCO Construction’s ‘The Sharp Diocean City Phase 2’ (pre-sold in February 2021) and HDC Hyundai Development Company’s ‘Gunsan Hosu Park I’Park’ (pre-sold in June 2021) recorded average first-priority competition rates of 58.77 to 1 and 55.79 to 1, respectively, ranking high in competition rates.

Moreover, pre-sale rights are being traded at high prices. According to actual transaction data from the Ministry of Land, Infrastructure and Transport, the pre-sale right for Hyundai Construction’s ‘Hillstate Eoullim Hyoja’ (pre-sold in November 2019), 84㎡ exclusive area, located in Wansan-gu, Jeonju-si, Jeollabuk-do, was traded for 518.61 million KRW (17th floor) in May this year, showing an increase of about 195 million KRW compared to the pre-sale price.

The industry expects the dominance of brand-name apartments in the provincial pre-sale market to grow further. Due to the recent high-intensity regulations concentrated in the metropolitan area, major construction companies are targeting the provincial pre-sale market and releasing a large volume of units.

An industry insider said, “As the price increase trend and high preference for brand-name apartments in the provincial housing market have been steadily proven, complexes constructed by major construction companies are drawing great responses even before pre-sale. In particular, brand-name apartments by major construction companies generally have high recognition and reliability, and often excellent product qualities, so they are expected to lead the remaining pre-sale market heat this year.”

Meanwhile, brand-name apartments by the top 10 construction companies are attracting attention as they prepare for pre-sale in the provincial market. Hyundai Construction plans to pre-sell ‘Hillstate Iksan’ in Iksan-si, Jeollabuk-do, in July. This complex consists of 6 buildings, ranging from 2 basement floors to a maximum of 29 floors above ground, with a total of 454 units sized between 59 and 126㎡ exclusive area. As the first ‘Hillstate’ brand complex to be built in Iksan, Jeollabuk-do, it offers excellent products and location. Most units are designed with a 4Bay slab-type structure for easy ventilation and airflow, and Hyundai Construction’s specialized designs such as ‘H Clean Entrance’ and built-in cleaners (some paid options) are applied to provide a pleasant indoor environment. Since it is a non-regulated area, anyone aged 19 or older with a subscription to a housing subscription savings account for more than 6 months can qualify for first priority, including household members, and resale is possible immediately after contract.

Hyundai Construction also plans to pre-sell ‘Hillstate Daegu Station First’ in Jung-gu, Daegu Metropolitan City, in July. The complex consists of two blocks, and the first to be supplied, Hillstate Daegu Station First, is a 216-unit apartment with an exclusive area of 84㎡, ranging from 5 basement floors to 41 floors above ground. The complex is within walking distance of Daegu Station on Daegu Metro Line 1 and Dalseong Park Station on Line 3. Additionally, it is adjacent to Dongseong-ro, considered Daegu’s largest central commercial district, providing convenient access to various cultural facilities such as CGV and Lotte Cinema, as well as medical facilities like Kyungpook National University Hospital and Dongsan Hospital.

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