Plans are underway to convert vacant offices and commercial spaces into youth housing, aimed at reducing the financial burden on young renters. However, achieving significant savings will require addressing high acquisition and conversion costs. According to an analysis by Aju Economy on November 9, the median purchase price for 328 officetels (small studio apartments) acquired by public institutions in Seoul over the past year was 267 million won for units ranging from 18 to 33 square meters. During the same period, the median monthly rent for small officetels in Seoul was reported at 780,000 won, based on deposits of 5 to 20 million won. To stabilize housing costs for young people, rents would need to be reduced by nearly half.
Concerns are growing that increasing the basic exemption for the comprehensive real estate tax for non-resident homeowners to 14 billion won could exacerbate the housing supply shortage in Seoul. If the tax burden is reduced from the previously proposed 9 billion won exemption, homeowners may be more inclined to retain their properties rather than sell them. This could impact the rental market by maintaining the current supply of rental housing. On November 9, the Democratic Party of Korea requested during a high-level government meeting that the exemption for non-resident homeowners be raised to match that of resident homeowners at 14 billion won. Earlier, the government had proposed lowering the exemption from 12 billion won to 9 billion won, but after pushback from the ruling party, the proposal was amended to retain the 12 billion won exemption in the National Assembly submission in September. While the ruling party is calling for further easing, the Blue House is reportedly taking a negative stance.
A notification of a 17.9 billion won burden under the Excess Profit Recovery System for the Banpo Hyundai reconstruction project has reignited debates over the need for reform or abolition of the system. As the financial burden on reconstruction members increases, there are fears that this could lead to delays in maintenance projects and a decrease in housing supply. On November 9, the maintenance industry reported that the Seocho District of Seoul had notified the Banpo Hyundai reconstruction association of the planned 17.9 billion won burden. Banpo Hyundai is currently being redeveloped into the Banpo Centerville Asterium, marking the first instance of the excess profit burden being imposed in the Gangnam area.
The government will implement a 'Minimum Guarantee System' starting November 13, allowing victims of jeonse fraud to recover at least one-third of their rental deposits. If the amount recovered through auctions or other means falls short of one-third, the government will provide cash to cover the difference. Additionally, victims of trust fraud will receive advance payments before the disposal of affected properties. On November 9, the Ministry of Land, Infrastructure and Transport announced that it would begin accepting pre-applications for minimum support funds and advance payments through the Korea Land and Housing Corporation (LH) starting November 10. This initiative follows the enactment of the Jeonse Fraud Victims Law in May, with the government having revised the enforcement decree and rules last month to establish criteria for calculating and distributing support funds.
* This article has been translated by AI.
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