The Ministry of Land, Infrastructure and Transport has proposed a record budget of 69 trillion won for 2027, an increase of over 6 trillion won from this year. Of this amount, 30 trillion won is earmarked specifically for housing supply. The ministry aims to enhance housing stability and accelerate supply by focusing financial resources on new public rental housing and supporting early construction at project financing (PF) sites.
According to the ministry, the 2027 budget plan totals 69 trillion won, up 6.2 trillion won (9.9%) from this year's main budget of 62.8 trillion won. The budget is divided into 24 trillion won for accounting, which is a decrease of 600 billion won (2.5%) from this year, while the fund allocation increases from 38.2 trillion won to 45 trillion won, a rise of 6.8 trillion won (17.8%). In terms of sectors, the social welfare budget increases from 41.7 trillion won to 47.9 trillion won, while the social overhead capital (SOC) budget remains at 21.1 trillion won, the same as this year.
The ministry plans to concentrate investments in four key areas: enhancing living standards, fostering future growth, promoting balanced development, and ensuring public safety.
◆Housing Budget Increased from 21.2 Trillion to 30 Trillion Won with New Public Rental Housing
The most notable increase is in the housing supply budget.
To support its plan to supply 1.1 million public housing units by 2030, the government will provide 218,000 public housing units next year, a 12% increase from this year's 194,000 units. The breakdown includes 172,000 public rentals, 34,000 public sales, and 12,000 publicly supported private rentals.
As a result, the housing supply budget will rise from 21.2 trillion won this year to 30 trillion won next year, an increase of 8.8 trillion won. Notably, a new 'universal public rental' program will be introduced, reflecting the needs of transit-oriented development and medium-sized units, with a total budget of 6.2 trillion won allocated for this initiative.
Specifically, the budget includes 4.77 trillion won for universal public rental loans, 238 billion won for universal multi-family purchase rental loans, and 900 billion won for universal jeonse rental loans.
More than 50% of the new universal rental housing will be allocated to young people. The budget for youth housing support will see a new allocation of 1.4 trillion won, while the budget for youth monthly rent support will increase from 130 billion won this year to 231.9 billion won next year.
Support for early construction of private housing projects will also be strengthened. The 'residential facility PF loan interest subsidy program' will allocate 169.6 billion won to support financial costs for residential facilities that begin construction early.
Additionally, 100 billion won will be allocated to 'PF Anchor REITs,' which involve public pre-investment in the early stages of development projects. The ministry plans to establish approximately 400 billion won in PF Anchor REITs next year.
Support for victims of jeonse fraud will continue, with 84 billion won allocated to a minimum support fund for victims whose recovery amounts do not reach one-third of their rental deposits.
◆Significant Increase in Autonomous Vehicle Budget to 880.1 Billion Won, New Physical AI and Overseas Construction Fund
Investments in future mobility will see substantial growth.
The budget for autonomous vehicles will surge from 73.1 billion won this year to 880.1 billion won next year. The number of autonomous vehicles deployed in five to six demonstration cities, including Gwangju, will increase from 200 to 3,000, and demand-responsive transport (DRT) services will be supported in 50 locations nationwide. The budget for urban air mobility (UAM) will rise from 8.2 billion won to 41.9 billion won, while funding for drones will increase from 48.2 billion won to 66.8 billion won.
In the construction sector, investments in physical AI will commence. A new allocation of 58.5 billion won will support the 'CO.AX project,' which focuses on the practical application of smart construction technologies, including testing and certification.
The budget for research and development (R&D) in land and transport will increase from 533.6 billion won to 556 billion won. A total of 1.2 trillion won will be invested in 28 new R&D projects centered on AI cities, future mobility, and carbon neutrality.
To transition overseas construction from a contracting and construction focus to investment and development, a new fund will be established. The government will invest 1 trillion won to create a 'New Overseas Construction Strategy Fund' with a total size of 3 trillion won, allocating 100 billion won for next year.
◆Continued Promotion of Major SOC Projects like GTX and Gadeokdo New Airport
In the SOC sector, major railway, road, and airport projects will continue to advance.
For railways, 14 billion won is allocated for GTX-A, 366.2 billion won for GTX-B, and 71.6 billion won for GTX-C. The construction of the Gangneung-Jejin railway will receive 445 billion won, while the Wolgok-Pangyo double-track railway will get 215 billion won, and the Southern Inland Railway will be allocated 200.6 billion won. The Gwangju Songjeong-Mokpo section of the Honam High-Speed Railway will receive 141.3 billion won.
In the airport sector, 431.1 billion won is allocated for the Gadeokdo New Airport. The budget also includes 120 billion won for the construction of the Saemangeum New Airport, 113.7 billion won for a small airport on Ulleungdo, and 202 billion won for compensation and design costs for the Daegu-Gyeongbuk Integrated New Airport.
A new 'specialized urban regeneration pilot project' will be launched to revitalize the declining city centers of local hub cities, with 29.4 billion won allocated for space support through vacant leasing and purchasing, as well as infrastructure development.
Safety budgets will also be expanded. The budget for maintaining roads, railways, and airports will increase from 51 trillion won to 53 trillion won, and the scope of ground exploration will expand from 4,360 km to 5,000 km.
New allocations include 5 billion won for fire safety performance enhancements in 5,000 piloti-structured apartment buildings and 31.4 billion won for fire safety assessments in factories and warehouses.
Alongside the budget increase, the ministry will also implement a restructuring of expenditures amounting to 96 trillion won. This includes adjusting the advance payment ratio for railway vehicle purchases and consolidating similar projects, while also considering the execution conditions due to delays in projects like the second airport in Jeju.
Kim Heon-jeong, head of the Ministry of Land's Planning and Coordination Office, stated, “Through strong expenditure restructuring, we aim to reduce wasteful budgets and maximize investment effectiveness, significantly enhancing investments in projects that the public can feel.”
* This article has been translated by AI.
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