2024.07.19. The Fair Economy — The Ministry of Economy and Finance announced that Deputy Prime Minister and Minister of Economy and Finance Choi Sang-mok presided over the 7th Real Estate Related Ministers' Meeting at the Government Complex Seoul in Jongno-gu, Seoul, on the 18th, and reviewed market trends such as recent housing price movements and supply conditions.
According to the Ministry of Economy and Finance, Deputy Prime Minister Choi Sang-mok noted that while the real estate market is not in a state of overall overheating, the rise in housing prices is spreading, especially in Seoul and the metropolitan area, and that the current situation is being taken seriously with intensified monitoring.
Furthermore, the government stated that ensuring national housing stability is a core livelihood issue, and that it will respond with full effort to stabilize the real estate market in coordination with relevant ministries.
First, it will significantly increase housing supply to ensure that young people and non-homeowner citizens can feel secure.
It will sell 236,000 units by 2029 at prices significantly lower than market prices, centering on the 3rd new towns with excellent residential conditions such as transportation, and additionally supply more than 20,000 new housing sites in the Seoul metropolitan area through the lifting of greenbelt designations in the second half of this year.
It will also revitalize housing supply through urban redevelopment and reconstruction.
Under this government, the designation of maintenance zones has increased significantly, and urban housing supply has expanded to more than twice the past average. The government will prepare institutional improvement measures to enhance the speed and profitability of maintenance projects and expand customized conflict mediation for each project site. For real estate project financing (PF), liquidity is being supplied smoothly, with a total of 24 trillion won in PF loan guarantees being executed for normal project sites, and as the recent PF business feasibility assessment has been completed, the government is inducing rapid restructuring of projects with low business feasibility.
In addition, it is accelerating the supply of non-apartment housing to stabilize the jeonse market.
It will increase the supply of public rental housing by at least 10,000 units beyond the originally planned 120,000 units, with 54,000 of these allocated to the Seoul metropolitan area in the second half of this year. It will also encourage private sector supply by providing tax support for the purchase of newly built small non-apartment units and expanding the scope of small housing recognized as non-homeowner status for housing subscription.
The trend of stabilizing household debt downward will also be strengthened.
It will implement the second phase of the Stressed DSR scheduled for September 2024 without delay, and strengthen supervision of housing policy finance. It will monitor the overall mortgage loan market and, if necessary, consider measures to tighten prudential regulations.
Deputy Prime Minister Choi emphasized that the government will thoroughly manage the market to prevent rising housing prices from leading to speculative demand. He stated that a joint on-site inspection team led by the Ministry of Land, Infrastructure and Transport will be activated to crack down on market-disrupting activities, strictly punish illegal acts, and collect evaded taxes.
In addition, he said that if market overheating appears despite these measures, special measures will also be devised.
In addition, to swiftly implement and review the above measures, a vice-ministerial-level task force among relevant ministries will be operated weekly. Plans to expand additional housing supply are scheduled to be announced in August.
Subsequently, Minister Park Sang-u of the Ministry of Land, Infrastructure and Transport said that as a result of the government's efforts to expand housing supply, such as the first-phase new town redevelopment pilot zone competition and the entry of solid jeonse housing, apartment construction in Seoul and the metropolitan area increased compared to the previous year in the period from January to May this year.
He also mentioned that the volume of apartment move-ins in Seoul will be 38,000 units in 2024 and 48,000 units in 2025, higher than the 10-year average, and in particular, 20,000 units in 2024 and 33,000 units in 2025 will be supplied from preferred complexes such as reconstruction and redevelopment.
In addition, starting with Incheon Gyeyang in September, the main subscription for a total of 236,000 units will be held in public housing sites such as the 3rd new towns, and a total of 242,000 units are scheduled for move-in, emphasizing that housing supply is sufficient.
Furthermore, he said that the government will discover more than 20,000 candidate sites for new housing sites in the Seoul metropolitan area, implement the supply of public non-apartment housing and follow-up legislative measures from the livelihood debate without a hitch, and check for illegal acts to establish transaction order in the real estate market.
In addition, he mentioned that while continuously improving the conditions for private housing supply, the government is also preparing additional supply expansion measures that the public sector can supplement.
The Ministry of Economy and Finance said, "Going forward, the government will maintain close coordination among related agencies to share a common understanding of the housing market situation, and will respond promptly by preparing appropriate measures."
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