Gov’t to supply 5 million pubic homes for next 5 years

Oct 27, 2022, 08:26 am

AsiaToday reporter Chung Ah-reum

The government has decided to supply 500,000 public housing units to young people and non-homeowners for the next five years by establishing ultra-low interest and long-term mortgages. In order to raise the chance of young people winning despite their relatively low house subscription points, the government decided to expand the lottery system for small and medium-sized private apartments while expanding additional points system for large apartments.

The government announced the plan entitled, ‘Supply plan of 500,000 public housing for youth and low-income residents’ on Wednesday. The main point of the plan is to significantly increase the amount of public housing units and to reorganize the house subscription system so that young people can afford their own houses.

Under the plan, the number of public housing units will be greatly increased. The government aims to supply 500,000 units from next year to 2027. Among them, 340,000 units or 68 percent are allotted for the youth, and the remaining 160,000 units for the middle-aged. A total of 360,000 units will be supplied in the greater Seoul area, including 60,000 units in Seoul.

Those unmarried aged 19 to 39 who have not purchased a house are eligible for the government’s special provision of housing for youth. Their income must be less than 140 percent of the monthly average of a single-person household and the net worth must be less than 260 million won. As of 2021, the average monthly income of a single urban worker household is 4,180,000 won.

The Ministry of Land, Infrastructure and Transport has decided to prepare the detailed requirements for the ‘special provision for youth’ plan before the housing pre-subscription scheduled for the end of the year.

The pre-sale subscription system will be also reformed. Among the 105,000 general supply units, 21,000 units or 20 percent will be sold by lottery. In the case of private housing subscription, the lottery system will be expanded up to 60 percent for small and medium-sized apartments in order to increase the chance of young people wining. Under the current system, an additional point system is applied to small and medium-sized apartments, and young people have a low chance of winning.

Young people have relatively fewer dependents and a shorter period of homelessness, making it hard to win small and medium-sized apartments with an area of less than 85 square meters.

Currently, the government sells all the small and medium-sized apartments in speculative overheated districts based on additional point system. However, the government will change the system by assigning 40 percent of housing units for additional point system and 60 percent for lottery system for apartments with an exclusive area of less than 60 square meters, while allotting 70 percent for additional point system and 30 percent for lottery for apartments over 60 square meters and less than 85 square meters.

The additional point system will be expanded for large apartments exceeding 85 square meters, which are in high demand among the middle-aged and elderly with three to four people in private housing. This is because the middle-aged group usually have a higher housing subscription point than young people.

The land ministry announced that it would finish improving the system to quickly supply 500,000 housing units for public sale, and will announce a public rental supply plan within this year.

#public house #supply #government #youth