Real estate in South Korea
Real estate in South Korea
Gangnam refers to three gus (wards) in southern part of Seoul, south of Han River, which includes Gangnam-gu, Seocho-gu and Songpa-gu. Apartment prices in Gangnam are the highest in South Korea, according to a Kookmin Bank analysis on apartment prices in the seven areas where prices have soared. Songpa-gu and Seocho-gu come second and third respectively followed by Cheongdam-dong, all in Seoul. Many multinational corporations are located in the Gangnam (강남) area.
Many consider the Pyeongchang-dong district in Jongno-gu as one of the wealthiest neighborhoods in Seoul. Situated within walking distance of Bukhansan National Park, the area is lined with two- or three-story houses with distinctive gable roofs, a symbol of upscale homes in Korean society. Due to its proximity to open spaces, the Pyeongchang-dong district is known as a more quiet area with hilly, tree-lined streets, in contrast to many neighboring districts with a more busy, urban feeling. The district also hosts two upscale hotels, the Bukak Park Hotel and the Olympia Hotel Seoul.
Hannam-dong and Itaewon
Hannam-dong (한남동) is the United Nations Village vicinity and contains residences of several high-ranking Korean officials and many foreign ambassadors. The Itaewon (이태원) area, close to the Yongsan Garrison of United States Forces Korea, is dotted with apartments, villas and large houses with gardens.
Seongbuk-dong (성북동) is a hilly area located near the wooded Mt. Bukhan.
Yeouido (여의도) is a large island within Seoul, and the center of Seoul's business district. Its 8.4 square kilometers are home to some 30,988 people. The island is located in the Yeongdeungpo-gu district of Seoul, and largely corresponds to the precinct of Yeoui-dong. Lying on the south edge of the Han River, it contains the National Assembly of South Korea, the Yoido Full Gospel Church, and many office buildings including the 63 Building and the headquarters of LG, and other chaebol.
Bundang (분당) is the southernmost district of Seongnam, South Korea. It is considered to be the thriving, beating heart of modern-day Seongnam. In the early 1990s, the Bundang area became a planned community as a response to alleviating the excessive demand for apartments in the similarly affluent, but much older Gangnam district area. Many of Bundang's early residents actually hailed from the Gangnam area, thereby distinguishing Bundang as an affluent borough in much the same manner as Gangnam. Before this period of expansion however, there was mostly farmland in this area. There are still a few farms in the Bundang area, particularly in the Pangyo area. As the demand for more housing continues, Bundang is expected to continue expanding.
Ilsan (일산) is the name of two districts (West and East) in Goyang, Gyeonggi-do. It is more organized and planned than the rest of the city, Goyang (Deogyang-gu), and its residents are generally more affluent. Ilsan is located northwest of Seoul. Like other satellite cities such as Bundang and Pyeongchon, Ilsan was planned in order to alleviate housing shortages in the city of Seoul. Ilsan has experienced phenomenal growth in the past 15 years, usually drawing in younger generations of upper middle-class Koreans.
Pangyo (판교) is planned for alleviating the excessive demand for apartments in Gangnam and Bundang. Today it is commonly referred to as Pangyo Techno Valley as it is the Silicon Valley for Korea as it hosts many companies ranging from biotech to information technology. Most of its residents are affluent as many have migrated from the nearby areas of Bundang and Gangnam with a growing number of foreign residents because of the density of international companies.
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When comparing the rental deposits or jeonse with the apartment price, the ratio was the lowest for Gangnam apartments. The jeonse to house price ratio is often used as a tool to gauge whether or not the house price is inflated.
This unique way of renting a house is called jeonse; a renter makes a lump-sum deposit on a rental space instead of paying monthly rent, at anywhere from 50 to 100% of the market value, and gets back the whole deposit when the rent contract ends. The home-owner is free to invest the deposit as wanted, as long as the same amount of money is returned to the tenant at the end of the contract.
Since the jeonse price reflects the actual demand of people who reside in the area, the gap between rental deposits for jeonse and the apartment sales price means there might be an economic bubble in the apartment price.
Depending on the area, jeonse prices can range as much as 80% of the home's sale price. The expensive Gangnam area's jeonse is about 30% of the sales price because those properties are so expensive.