Input 2021.03.04 06:00
Ministry of Land, Infrastructure and Transport Minister Byeon Chang-heum said that he would modify the pre-sale price calculation system to fit the purpose of the pre-sale price ceiling system, but experts are continuing to analyze that there will be no trick to lowering the pre-sale price. This is because the Ministry of Land, Infrastructure and Transport also acknowledges that labor costs and construction material costs have risen.
There is a cautious outlook that the additional cost can be adjusted artificially, but some point out that in this case, there may be side effects that increase the scarcity of existing apartments. Construction companies are also keen on the point that they may have to lower their earnings level.
Construction cost is calculated by the Korea Institute of Construction Technology twice a year in March and September, based on the general quality level of public and private housing, calculated by calculating all costs for housing construction, and then notified by the Minister of Land, Infrastructure and Transport, reflecting changes in prices, etc. do. The construction cost of the ground floor is set differently by the number of floors and area, and the construction cost of the basement floor where the underground parking lot is built is also divided based on the exclusive 85㎡.
In September of last year, the Ministry of Land, Infrastructure and Transport reduced construction costs by 2.69%. This is because the construction cost of the foundation pile is not included in the construction cost, but is converted into an additional cost. An official in the construction industry said, “The reason was different, but in fact, it was open to the possibility of lowering the pre-sale price with the cap on the pre-sale price in mind.”
However, now that even the construction cost has risen, it is not easy to find a way to lower the pre-sale price. In the real estate industry, there is virtually no way to lower pre-sale prices as construction costs rise, and they are concerned that artificially lowering them will only cause side effects.
The sale price of an apartment subject to the sale price ceiling system is calculated by adding the housing cost (land appraisal amount), construction cost, and addition cost. Among them, the cost of housing land has received two or more results from appraisers, and there is little room for intervention by the Ministry of Land, Infrastructure and Transport, the local government, and the Korea Real Estate Agency. This is because the act of appraisal must maintain independence.
The union is excluded from the process of designating an appraisal company, fearing that there will be attempts to increase the business value by increasing the sale price. An official in the construction industry said, “The cost of land is rising when the land price rises, so it cannot be lowered without artificially lowering the land price.”
What’s left is the adjustment of the addition ratio. The additional cost is the cost of equipment in the process of developing a housing site. Costs such as specialized design or eco-friendly design are included here. The construction industry believes that the government can lower the pre-sale price by partially adjusting the additional cost. This is possible by excluding expenses that were previously recognized as additional expenses. However, this makes it difficult to meet the eye level of the reconstruction/redevelopment project site association.
An official at a large construction company said, “When you place an order, you must present various specialized designs to members and include them in the additional cost. If the scope of accreditation decreases, it could eat up the construction company’s profits, and conflict may arise due to the issue of adding unions and contributions. “I said.
Real estate experts are also concerned that artificial control of the additional cost will only increase the differentiatedness of existing new apartments. In the redevelopment and reconstruction projects, specialized design has been regarded as important as it is in contrast to other apartments, because if the additional cost is adjusted, it can be deleted or reduced.
Park Won-gap, chief real estate expert at KB Kookmin Bank, said, “In an era where community facilities become the standard for good apartments, if this part is reduced due to the reduction of the cost, there is a possibility that it will be classified as a bad apartment compared to other apartments.” However, if you intervene artificially, unexpected side effects may occur.”