As expectations for a semiconductor boom and a labor agreement at Samsung Electronics drive up apartment prices in Hwaseong's Dongtan New Town, instances of contract cancellations are rising rapidly. With price increases surpassing the penalties for contract breaches, some homeowners are opting to cancel agreements and relist their properties at higher prices.
According to the Ministry of Land, Infrastructure and Transport's real transaction disclosure system, 1,355 apartment sales contracts were reported in Dongtan, Hwaseong, for May. Given that the reporting deadline for May transactions extends until the end of this month, this figure exceeds both last month's total of 1,001 and the 1,121 transactions recorded in November of last year, which was influenced by the government's 10·15 measures.
Contract cancellations have also increased. So far, 82 cancellations have been recorded for May, accounting for 6.1% of all contracts. This marks a 74% increase from the previous month, which saw 47 cancellations.
Local real estate agents report that following the Samsung Electronics labor agreement, prices in key complexes near Dongtan Station have surged in a short period, leading to a spike in contract cancellations.
A real estate agent in Cheonggye-dong noted that a homeowner who sold a property for 1.6 billion won last month returned the deposit and paid double the penalty, then relisted the property for 1.9 billion won. The agent explained that even after paying the penalty, the homeowner anticipated a profit of 140 million won, prompting the cancellation.
Indeed, preferred complexes near Dongtan Station have reportedly seen price increases of 300 million to 400 million won over the past two weeks. For instance, a 84-square-meter unit in the Lotte Castle Dongtan, a flagship complex, sold for 2.225 billion won on June 4, and current asking prices have risen to around 2.4 billion won. This represents an increase of 400 million to 500 million won compared to the previous month's transaction price of 1.9 billion to 2 billion won.
Contract cancellations have been particularly concentrated in the Dongtan Station area. In Cheonggye-dong, 28 out of 257 contracts were canceled in May, resulting in a cancellation rate of 10.9%, nearly double the average cancellation rate in Dongtan (6.1%). In Yeoul-dong, 12 out of 159 contracts (7.5%) were canceled.
The rise in cancellations has led to conflicts between buyers and sellers. Some buyers have offered to expedite down payments to prevent contract breaches, but sellers have reportedly rejected these proposals.
The upward trend in prices is spreading beyond the Dongtan Station area to the southeastern Dongtan region. A 106.94-square-meter unit in the Dongtan Rinstrauss de Lake near Dongtan Lake Park sold for 1.5 billion won, setting a new record. This price is approximately 100 million to 130 million won higher than the previous transaction.
Local real estate professionals have raised concerns that the government may have missed the opportunity to respond to the market amid discussions of regulatory measures following the rapid price increases.
Meanwhile, according to the Korea Real Estate Agency's report on apartment price trends for the third week of June (as of June 15), Seoul apartment prices have risen for three consecutive weeks by 0.27%, while Hwaseong's Dongtan New Town recorded a surge of over 2%.
* This article has been translated by AI.
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