Gyeonggi Province House Prices Surge on Semiconductor Boom: Dongtan Ranks First in Growth Rate

[Anchor]

It is time for Friendly Economy on Wednesday, and reporter Han Jiyeon is here with us. Han, today (the 9th) we are talking about housing prices in Gyeonggi Province.

[Reporter]

Based on the final week of August, Gyeonggi Province accounted for eight out of the top ten cumulative housing price growth rates nationwide this year.

Gyeonggi is sweeping the top rankings.

According to data from the Korea Real Estate Board, the number one spot nationwide went to Dongtan-gu in Hwaseong, which recorded a growth rate of 17.25%.

Gwangmyeong and Suji-gu in Yongin followed closely with growth rates in the 13% range.

Regions with growth rates in the 10% range, including Dongan-gu in Anyang, Bundang-gu in Seongnam, and Yeongtong-gu in Suwon, are lined up right behind them.

The driving force behind Dongtan's surge is the favorable semiconductor industry conditions, which have increased the purchasing power of Samsung Electronics executives and employees, combined with expectations surrounding the Yongin semiconductor cluster.

Some analyze that purchasing power has grown even further due to unprecedented incentive bonuses in the semiconductor industry coupled with in-house corporate loans.

As people who sold their homes at higher prices in Dongtan attempt to trade up to Bundang or Suji, they are pushing up housing prices in those areas as well.

While Dongtan and Yeongtong rank first and sixth respectively in cumulative growth, the actual pace of increase has slowed down recently due to the burden of short-term rapid price surges and regulatory impacts.

Giheung is also a regulated zone, but it has relatively many lower-priced apartments, which is analyzed to have drawn migrating demand.

[Anchor]

However, you singled out Pyeongchon among the areas in Gyeonggi Province.

[Reporter]

As the upward trend in housing prices across southern Gyeonggi Province spreads, major apartment prices in Pyeongchon, Anyang, have risen to the 1.7 billion won range.

Dongan-gu in Anyang, meaning the Pyeongchon New Town area, climbed to fourth place nationwide with a cumulative growth rate of 12.9% this year.

Looking at actual transactions, a 102-square-meter unit was sold for 1.785 billion won last month, which is an increase of 385 million won in just one year compared to 1.4 billion won in August of last year.

Pre-completion subscription rights for an 84-square-meter unit in a new apartment complex scheduled for occupancy have also reached up to 1.73 billion won.

This is interpreted as buying momentum spreading to Pyeongchon, which had relatively lower prices as Gwacheon, Bundang, Dongtan, and Yeongtong rose first.

It can be said that a so-called catch-up phenomenon has spread, where relatively low housing prices rise together to match neighboring market prices.

Pyeongchon also has its own favorable factors.

There are expectations for reconstruction as a first-generation new town, and it is well-equipped with a prominent academy district.

With over 300 registered private academies clustered within a radius of around 500 meters, it is sometimes evaluated as having an even higher density than the academy district in Junggye-dong, Nowon-gu, Seoul.

[Anchor]

What is the final topic?

[Reporter]

Starting today, individuals can directly purchase government bonds for individual investors through their retirement pension accounts, triggering a competition among banks and securities firms to attract customers.

Government bonds, which could previously only be bought through dedicated accounts, can now be purchased directly through defined contribution (DC) and individual retirement pension (IRP) accounts starting today.

Applications can be made through three banks—Shinhan, Hana, and Nonghyup—as well as five securities firms—Mirae Asset, Samsung, Korea Investment & Securities, KB Securities, and NH Investment & Securities.

Investors can choose between 10-year and 20-year maturities, with investments available starting from a minimum of 100,000 won in 100,000 won increments.

Based on the September issuance, the 10-year bond offers an annual rate of 4.765% and the 20-year bond offers 4.92%. If held until maturity, the principal and interest calculated with compound interest are paid out in a lump sum.

There are also tax benefits.

Based on newly contributed funds, individuals can receive tax deductions of up to 9 million won per year when combined with a pension savings account.

If someone maxes out this limit this year by investing 9 million won into a 20-year bond, the pre-tax amount at maturity will reach 23.5 million won, which is 2.6 times the principal.

Factoring in a year-end tax settlement tax deduction of up to 1.485 million won, the perceived return becomes even greater.

Furthermore, if the tax-deducted funds and investment returns are received in installments as a pension after the age of 55, a low tax rate of 3.3% to 5.5% is applied instead of the standard 15.4% interest income tax.

Also, while retirement pensions typically allow a maximum of up to 70% to be placed in risky assets, government bonds guarantee the principal, allowing investors to allocate their entire accumulated reserve without this restriction.

However, there is a monthly issuance limit, meaning that if applications surge, you might not be able to purchase as much as desired.

There are also risks to keep in mind.

Early redemption is permitted after one year from the issuance date, but application periods are fixed. Selling early causes the compounded benefits and added interest margins to disappear, reverting the return to a basic interest rate applied only to the principal.

If you do not plan to hold the bonds until maturity, the appeal may be limited.
※ Please note: This article was translated by AI and may contain errors.