The South Korean government is accelerating the supply of public housing in the metropolitan area, including the Third New Towns. However, experts argue that merely shortening the project timeline will not sufficiently stabilize the housing market in the region. Delays in the supply schedule for many projects, along with the need to align housing occupancy with the development of transportation networks and living infrastructure, are cited as reasons for the limited impact.
According to the Ministry of Land, Infrastructure and Transport, the Third New Towns initiative was launched in 2018 to increase housing supply in Seoul and the surrounding areas to stabilize housing prices. The plan includes approximately 170,000 housing units across six districts, including Wangsuk and Wangsuk 2 in Namyangju, Gyosan in Hanam, Gyeonggi's Goyang Changneung, Incheon Gyeong, and Bucheon Daejang.
However, since the announcement of candidate sites, repeated delays in compensation, demolition of existing structures, land development, and cultural heritage investigations have pushed back the actual construction and occupancy dates for many complexes. For instance, the construction period for the S-3 and S-4 blocks in Goyang Changneung has been extended by 15 months, while the A10 block in Incheon Gyeong has seen a 12-month delay, and the S-18 block in Namyangju Wangsuk has been delayed by 19 months.
Experts highlight that the most significant issue is the delayed timing of the supply impact. Even if the government shortens the construction period for new public housing, it will still take considerable time before residents can move into the ongoing Third New Towns, limiting the ability to address the housing supply-demand imbalance in the short term.
Park Hap-soo, an adjunct professor at Konkuk University’s Graduate School of Real Estate, stated, “The primary reason for the delays in the Third New Towns is the slow land compensation process. For a project with 500 units, the actual construction period requires about 36 months, making it physically challenging to reduce the original 60-month timeline to just 30 months.”
Aligning the timing of housing supply with the development of transportation networks is also a challenge. The core objective of the Third New Towns is to disperse housing demand from Seoul to the metropolitan area. If residents begin moving in but the transportation infrastructure, such as railways and roads, is not in place, it may limit the appeal for potential buyers.
Yang Ji-young, a specialist at Shinhan Bank’s Premier Pathfinder, emphasized, “While rapid housing supply in the Third New Towns is important, the development of transportation networks is equally crucial. In the case of Paju Unjeong New Town, residents faced significant transportation inconveniences due to delays in the transportation network’s construction.”
She added, “For the Third New Towns to succeed, it is essential to develop not only transportation networks but also jobs, education, and living conveniences in alignment with the occupancy timeline, so that potential residents can confidently choose these areas as their homes.”
As the government moves to shorten project timelines, concerns have been raised that discussions regarding the reorganization of the Korea Land and Housing Corporation (LH) should not become a variable affecting the supply schedule. If the decision-making process or project execution slows down during the reorganization of LH, which oversees public land development, housing construction, and compensation, it could lead to further delays in the supply schedule.
Seo Jin-hyung, a professor of real estate law at Kwangwoon University, stated, “It is crucial to establish transportation networks in a timely manner before increasing housing supply. Given that discussions regarding the separation of LH are ongoing, it is essential to closely manage project execution to prevent any disruptions related to supply expansion.”
* This article has been translated by AI.
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