On July 23, a real estate forum chaired by President Lee Jae-myung was held at the KBS Annex in Seoul, where various proposals were made regarding the critical issue of expanding housing supply.
Many participants pointed out that the current regulations on relocation loans in redevelopment projects are hindering supply, indicating a need for policy adjustments.
Yang Ji-young, a specialist at Shinhan Premier Pathfinder, noted that the time required for the management and disposal approval of reconstruction apartments has increased from 5-7 years in the past to 8-10 years recently.
Yang emphasized, "In the Gangnam area of Seoul, major construction companies can obtain both basic relocation loans and additional loans, but in other regions, projects must proceed with only the basic relocation loan, making it difficult to move forward."
There were also calls for a more refined government policy on private rental supply. It was suggested that incentives be provided to private construction rental housing providers to encourage the supply of long-term rental housing in the market.
Chae Sang-wook, CEO of Connected Ground, stated, "The government's measures include public sales, public rentals, and private sales, but there is no information on how many private rental units will be built in which regions over the next five years under the Lee Jae-myung administration." He added that a system to collectively nurture private long-term rental suppliers and introduce financing for them is necessary to prevent various regulations, such as property taxes, from affecting the private rental market.
To address the simultaneous rise in sales and rental prices, it was suggested to increase the supply of non-apartment housing, such as villas and officetels, for immediate effect, while accelerating large-scale supply measures, including the third new towns.
Ko Jong-wan, head of the Korea Asset Management Institute, remarked, "Selective promotion of reconstruction and redevelopment is necessary, but increasing the supply of non-apartment housing like villas and officetels will be effective for short-term supply." He also urged the government to speed up the housing supply plan for 270,000 units in the third new towns and to establish a regular policy consultation body with the Ministry of Land and local governments to resolve delays in sites like Taereung CC and Yongsan Maintenance Depot.
Regarding the surge in construction costs, he pointed out that rising material and labor costs are major factors. He suggested implementing a 'material stockpiling system' to lower costs, similar to land and crude oil, and temporarily lifting the quota system for foreign skilled workers in the construction industry.
President Lee Jae-myung also commented, "The delays in the commencement of previously announced areas, such as the third new towns, are a serious issue. It is said to take over sixty months. The administrative speed is too slow." He added, "We are considering ways to reduce this period by more than half, whether by changing regulations or by concurrently processing procedures that are usually done sequentially."
* This article has been translated by AI.
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