S. Korea to supply 55,000 more public homes

Sep 27, 2023, 09:03 am

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Won Hee-ryong, the minister of Land, Infrastructure and Transport, gives a briefing about measures to boost housing supply at the central government complex in Seoul on Sept. 26, 2023. / Source: Yonhap News

AsiaToday reporter Chun Won-joon

The government said it will provide an additional 55,000 public housing units, including 30,000 units in the third new town. Along with the supply expansion, the government will simplify various administrative procedures to speed up supply. The move comes amid concerns that the supply of new homes would be insufficient within two to three years as the volume of licensing, construction and sales have decreased significantly in the aftermath of the real estate market recession. 

The government also plans to increase the amount of guarantee for project financing loans by 10 trillion won and expand the financial supply of private financial institutions to resolve the financial shortage in the construction industry. Through this, the government plans to meet the Yoon Suk-yeol administration’s target to supply a total of 2.7 million homes in Yoon’s five-year term until 2027 while achieving the goal of supplying 470,000 housing units for this year. 

The government on Tuesday held the 6th real estate-related ministers’ meeting, presided over by Deputy Prime Minister and Finance Minister Choo Kyung-ho, to announce the plan to stabilize the real estate market. 

Under the plan, the government will provide a total of 55,000 additional public homes, including 30,000 in the third new towns near the capital city of Seoul, and 20,000 in new housing sites. 

The third new towns in the greater Seoul area were originally planned to supply 176,000 home units. Within the scope of maintaining a pleasant residential environment, the government plans to increase land-use efficiency to supply 30,000 more home units.

The new apartments which were set to be constructed in the new public housing sites will be expanded to a total of 85,000 units, which is an increase of 20,000 units from the initial plan of 65,000. The government plans to announce the candidate sites in November, instead of its initial plan of announcing in the first half of next year. 

In order to speed up supply, administrative procedures will be greatly simplified. The district plan and housing project plan will be approved simultaneously to shorten the period of projects by more than four to six months, and various impact assessments needed to approve the housing project plan will be allowed to be completed before the approval of final changes or beginning of construction.

Among the third new towns, Wangsuk in Namyangju city, Changneung in Goyang city, Gyosan in Hanam city, and Daejang district in Bucheon city will begin suite building work this year. In the case of Gyeyang in Incheon city, construction of housing is expected to take place this year. 

In order to revitalize private housing construction projects, the government will temporarily ease restrictions on the resale of public housing sites for one year and provide incentives to construction companies that receive early approvals by giving priority for a portion of the new land for housing construction. 

Various licensing procedures will also be significantly improved. The government will make it mandatory to review the approval of housing projects to shorten the period of the projects and establish reasonable standards for school facility donations to expand the exemption of school land charges.

The government will also increase the guaranteed size of PF loans from 15 trillion won (US$11 billion) to 25 trillion won. The loan limit for PF loans will be raised from 50 percent of the total project cost to 70 percent. 

#public home #supply #real estate market 
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