HUG Sale Price Standard Opaque Reform... Controversy Over 'Dunchon Jugong Public Sentiment Soothing'

No Official Announcement on the Restructuring Itself... Details Still 'Internal Information'
Earlier, Dunchon Jugong Association Members' Complaints Flood In... "Considering Votes Ahead of General Election" Suspicions Raised

Dunchon Jugong Apartment Demolition Site, Gangdong-gu, Seoul / Photo by Moon Honam munonam@

[Asia Economy Reporter Onyu Lim] The Housing and Urban Guarantee Corporation (HUG) has sparked controversy by revamping its high-priced housing price review criteria while still not disclosing specific details. Experts point out that since the pricing of housing units affects property rights, a more transparent disclosure principle should be established and applied consistently.

According to industry sources on the 13th, HUG recently subdivided and changed some items in the 'High-priced Housing Project Review Criteria.' While maintaining the overall framework of the existing review criteria, the main point is to subdivide and review the characteristics of individual complexes such as location, scale, and brand. Until now, HUG has calculated housing prices by finding comparable complexes within a 2 km radius of the project site in the same autonomous district, in the order of ▲within 1 year of sale ▲1 year after sale to before completion ▲within 10 years after completion.

According to the revision plan, the 'brand' category, which was previously divided into three units based on contractor ranking of 1?30, 31?100, and below 101, will be further subdivided into smaller units such as 1?10, 11?20, and 21?30 for comparison. The 'complex scale' will be treated similarly. If there are unavoidable differences between the sale complex and the comparable complex, the sale price can be adjusted to reflect this. A HUG official explained, "If the sale complex has significantly better conditions than the comparable complex, the sale price can be raised."

However, since the revision itself was not officially announced and specific review criteria are still not disclosed citing 'internal regulations,' criticisms of a 'black box standard' continue. There is also much debate about the timing of the revision, as large apartment complexes in the Gangnam area are expected to benefit ahead of the general elections in April.

A representative example is Dunchon Jugong in Gangdong-gu, which has over 6,000 union members. Dunchon Jugong has seen a large gap between the general sale price set by the union (35.5 million KRW per 3.3㎡) and HUG’s expected general sale price (around 26 million KRW per 3.3㎡), leading residents to file collective complaints. On real estate communities, posts such as "Did the system change because of the flood of complaints to HUG?" and "There is suspicion that the revision is for Dunchon Jugong" are appearing. On the 11th, a Blue House petition opposing HUG’s revision of the high-priced housing review criteria also emerged. Last year, when union members strongly opposed the pricing of Gireum 1 District in Seongbuk-gu, HUG changed the comparable complexes and approved the price, sparking controversy over 'rubber band pricing.'

Professor Daejung Kwon of Myongji University Graduate School of Real Estate said, "Diversifying the criteria for housing price calculation itself is positive, but it should not be used unilaterally as a means to raise prices. Consistent application of standards is important."

This content was produced with the assistance of AI translation services.