Government Plans to Start Construction on 1.5 Million Homes by End of Term

Han Jun-kyung, the Chief Economic Officer at the Blue House, projected that approximately 1.5 million homes could begin construction during the term of the Lee Jae-myung administration. He emphasized the need to publicize plans to utilize Yongsan Park and surrounding return sites for public housing supply, which were excluded from the recent housing measures after much debate.

On August 13, Han appeared on CBS Radio's 'Park Jae-hong's One-on-One Debate' and stated that when considering the September 7 measures from last year, the January 29 measures from this year, and the current supply measures, "we can expect to start construction on about 1.5 million homes by the end of the term."

He explained that the current supply measures include over 230,000 homes, with approximately 100,000 of those being new sites. The government has disclosed specific locations for 27,000 of these homes.

Han noted that discussions with relevant agencies regarding the remaining new sites are well underway, indicating that additional announcements could be made within the year. He mentioned that more than 120,000 homes could be constructed relatively quickly.

He also proposed measures to shorten the project timeline. Previously, each administrative procedure would begin only after the previous one was completed, but he stated that procedures that do not need to be sequential will be conducted simultaneously.

Additionally, he plans to reduce the lengthy review periods, cutting the approval timeline from over five years to about three years. A Rapid Supply Innovation Team, involving relevant ministries and local governments, will be established to address delays in approvals and resolve inter-agency disagreements.

In the second phase of new towns, 28,000 homes are set to begin construction by 2030. The plan includes supplying 14,000 homes in 2026 and 2027, with an average of over 3,000 homes to be sold annually during the remainder of the current administration.

The construction target for the third phase of new towns has been expanded from 177,000 to 195,000 homes by 2030, a more than 10% increase. Han stated that 17,000 homes will be supplied in 2026 and 2027, with plans to sell over 10,000 homes annually starting in 2028.

Han also mentioned specific construction timelines for major sites in Seoul. He projected that construction on the Taereung Country Club site could begin in September 2029, ahead of the original 2030 timeline. The horse racing track site is expected to start by the end of 2029, while approximately 3,000 homes in the previously announced Gangseo-gu military site are set to begin construction next year.

He raised concerns about the utilization of Yongsan Park, noting that while the area is large, it has few users. He highlighted that cleaning up soil contamination will require billions of won, and the responsibility for these costs has not been clearly defined. He suggested that it is necessary to discuss whether it is appropriate to leave the site vacant.

Han explained that areas returned from the U.S. military, where low-rise residences and offices are located, could be developed relatively quickly. Instead of selling these sites to private entities, the government could consider developing them into public housing for young people.

Regarding Seoul Mayor Oh Se-hoon's opposition to housing supply in Yongsan Park, Han stated that relevant departments are closely coordinating with the city to resolve any disagreements.

Han emphasized that the success of real estate policies should be judged by whether they alleviate the public's anxiety and burden regarding housing issues. He clarified that rather than setting a specific housing price as a policy goal, the fundamental direction of the policy should be to shift funds and social resources concentrated in real estate to more productive areas.

In response to concerns that recent tax reforms could destabilize the high-end rental market, he assured that the government will closely monitor market conditions and seek solutions. He characterized property taxes as compensation for the increase in housing value due to public infrastructure and services, stressing the need to enhance tax equity between real estate income and labor income.

Han concluded that it is inappropriate to set market prices as a policy goal, stating, "While we do monitor whether prices are at a reasonable level compared to income, ultimately, the important thing is to allow people to live without being overly concerned about real estate."