Controversy over volume splashing and infringement of property rights
Housing can be supplied only by private selection… It is difficult to force secure land
Block the real deal… New apartment’balloon effect’
All efforts to speed up government business
View of villas and apartments in downtown Seoul. / Photo = News 1
The government’s 25th measure is also losing trust. The second and fourth real estate measures, which President Moon Jae-in called’special measures’ as the first measure after the inauguration of Minister Byeon Chang-heum of the Ministry of Land, Infrastructure and Transport are engulfed in various controversies. It was said that it would supply 320,000 households to Seoul, including 830,000 households, but it is unclear when, where and how much.
According to industry sources on the 10th, controversy over’property infringement’ related to the development of Jokbangchon is being raised, and the market is freezing as the government imposes that’cash liquidation’ for transactions after the announcement of measures is made. This is because the uncertainty in buying a house for the purpose of living in addition to investment has increased. On the other hand, the popularity of new apartments is soaring as the number of items available for trading decreases. The vicious cycle of raising the house price is a pattern that is repeated again.
He said he would supply 320,000 households to Seoul by 2025…
According to the government’s measures for 2nd and 4th real estate, the government decided to supply 830,000 units nationwide, including 323,000 households in Seoul, by 2025, but this is the standard for securing land. In particular, most of the housing supplied from Seoul is dependent on the private sector, which is inevitably different from the government’s plan. Excluding 43,000 households, including 25,000 newly purchased and 18,000 non-housing remodeling households, it is difficult to secure a site for the rest.
Most of Seoul’s supplies depend on private choice. Maintenance projects (93,000 households), station area (78,000 households), semi-industrial areas (3000 households), and low-rise residential areas (13,000 households) can only be promoted with the understanding of the landowner, landlord, and tenant. . It means that it is far from the government’s promise. Minister of Land, Infrastructure and Transport Byun Chang-heum appeared on a broadcast after announcing the measures and said, “Even conservatively in downtown Seoul, 222 places can become the project destinations that the government thinks.” I even used the expression “supply shock level”.
Seoul Dongja-dong Jikbangchon, the country’s largest gangbang area, will be developed as an apartment complex. Minister of Land, Infrastructure and Transport Byun Chang-heum (center) is looking at the whole area of Jikbangchon from Dongja-dong KDB Life Tower on the 5th. /Data = Hankyung DB
However, as it depends on the private sector, it is impossible to force the securing of the site, and considering the promotion of the business, it is forecast that housing supply will not be possible in a short time. First of all, even if the stakeholders agree, construction can be started only after going through the basic urban plan, infrastructure, and site development. Even if construction is possible immediately, the supply of apartments can be expected only after 3-4 years. If you start by securing a site, houses will come out 7 to 8 years later.
It is difficult to avoid the controversy over infringement of property rights and private property rights that arise during the project promotion process. When the government announced a maintenance project for Dongja-dong Jeokbang Village near Seoul Station, the country’s largest cluster of jeokbang, land owners protested. The Huam Special Plan Zone 1 (Dongja) Preparation Promotion Committee said, “The land and building owners in the region are opposed to the decision to promote the’Seoul Station Sidebang Village Maintenance Project’ announced by the government.” I did not collect opinions.”
The government announced that it will supply 1250 public rental housing units, 200 units for public sales, and 960 units for private sales housing, which will be re-occupied by all residents in the area as a maintenance project for 47,000 square meters in Dongja-dong, Yongsan-gu. Korea Land and Housing Corporation (LH) and Seoul Housing and Urban Corporation (SH) participate in the project as joint project operators. Minister Byeon explained, “It has been designated as a small-scale development project under the Special Public Housing Act, and this allows public institutions to designate areas that urgently need public housing, regardless of resident consent.” If the business goes smoothly, the government’s move-in period is 2026. In the case of private sales, it is expected that it will be delayed and will be possible only by 2030.
Seoul Station side bang village backlash… Villa transaction for real residence is also’tuk’
The most pointed out in the market is the right to move in. The government announced that for transactions made after February 4, the date of the announcement of the measures, there is no right to move in first, and that it will liquidate cash. As transactions in areas subject to redevelopment such as villas, multi-family households, and multi-family buildings in the Seoul area were cut off, sellers and end-users trying to sell became difficult.
Usually, owners of homeowners in maintenance projects have a right to move in to a new home in proportion to their existing home. However, according to the government’s announcement, if you own the right to the house after the 4th, you will be returned with cash equivalent to the appraised value instead of the right to move in. Pursuing redevelopment and reconstruction, or buying a villa or apartment in an area that is likely to be promoted, it is now possible to face liquidation at an appraised price significantly lower than the market price.
The problem is the end users. This is because many villas live for two purposes: real residence and investment. Even if redevelopment is not possible right away, consumers who want to build their own homes at a lower price than apartments have already begun to flock to villas from the second half of last year. According to the Seoul Real Estate Information Plaza, the number of transactions in Seoul villas last month was 2776, overtaking the volume of apartments (2366). The reason that the villa transaction has exceeded the apartment has been continuing since last November. In the case of reconstruction, as the requirements for real residence are strengthened, new buyers are choosing to live directly.
In the midst of this, the’Cash Clearing’ card that the government took out is showing a’balloon effect’ as a new apartment while reversing market transactions. In areas where new apartments such as Masongseong (Seongdong-gu, Yongsan, Mapo) and Dongjak-gu are crowded, after the announcement of measures, the selling price rose more than 100 million won.
Government, LH-SH and local governments join hands to increase speed
Meanwhile, the government is planning to go ahead with speed to implement measures. The Ministry of Land, Infrastructure and Transport decided to establish a cooperation system with the Seoul Metropolitan Government to quickly implement the 2·4 supply measures. The’Regular Meeting for Promotion of Housing Supply Projects’ is held every month in which the 1st Vice Minister of Land, Infrastructure and Transport and the Vice Mayor of Seoul City participate, and working-level discussions are held every week.
The Ministry of Land, Infrastructure and Transport is also reorganizing the organizational system for reorganization and reinforcement of functions of the department in charge of housing supply. Public institutions such as Korea Land and Housing Corporation (LH) and Seoul Housing and Urban Corporation (SH), which will promote projects as public implementers, are also planning to establish a department in charge of detailed measures for each project and start reinforcing personnel for each project. LH and SH will focus on briefing sessions for the next three months.
Photo = Yonhap News
Significantly expand the organization and manpower of the maintenance project integrated support center currently in operation. Integrated support centers will be installed not only in Seoul, but also in Gyeonggi, Incheon, and local metropolitan cities. The organization and manpower of the LH Metropolitan Special Headquarters and Regional Headquarters in the metropolitan area will be expanded. The city of Seoul plans to revise the related ordinances so that this measure can be implemented as soon as possible.
Various legal amendments are also promoted. The revised bills of the’Urban and Residential Environment Improvement Act’ (Provincial Government Act) and the’Special Act on Construction of Public Housing, etc.’ (Gongju Act) are expected to contain contents to revitalize the project. Restrictions on setting boundaries of maintenance areas, strengthening requirements for securing sites, deregulation of urban and buildings, and tax benefits are applied.
Hankyung.com reporter Kim Hana [email protected]