If Public Sale Housing Residency Obligation Is Violated... Repurchase Obligation for Suppliers Enforced from May

Notice of Legislative Amendment to the Enforcement Decree of the Special Act on Public Housing
The Implementer Must Repurchase Even If the Resident Does Not Apply for Repurchase

[Asia Economy Reporter Moon Jiwon] Starting from May, residents living in public sale housing in the Seoul metropolitan area who are found to have violated the mandatory residence requirement must resell their homes to the supplier, such as the Korea Land and Housing Corporation (LH), and the supplier is required to repurchase them.

On the 26th, the Ministry of Land, Infrastructure and Transport announced that it had given prior notice of a partial amendment to the Enforcement Decree of the Public Housing Special Act containing these provisions on the 25th. The amendment will take effect on May 27 after a six-month grace period.

According to the amendment, if a resident of a public sale house supplied on public land in the Seoul metropolitan area fails to fulfill the mandatory residence period of 3 to 5 years, the public housing project operator who supplied the house must repurchase it.

Previously, through the September 13, 2018 measures, the government announced that public sale houses, which are exceptionally allowed to be resold during the resale restriction period, would be required to be repurchased by the project operator. Accordingly, when the government prepared the bill, houses that violated the mandatory residence period were also included as subjects that must be repurchased.

The mandatory residence period is 5 years if the sale price is less than 80% of the nearby area's housing sale price, and 3 years if it is between 80% and less than 100%. In cases such as relocating due to livelihood reasons, resale is exceptionally permitted regardless of the mandatory residence period.

Under current law, until now, residents who violated this residence obligation were required to request repurchase of the public sale house, but there was no regulation requiring the project operator to necessarily repurchase it. Therefore, many residents disposed of their homes to third parties without fulfilling the mandatory residence period.

However, once this amendment is enforced, the project operator must repurchase the house even if the resident does not apply for repurchase, which is expected to significantly reduce legal blind spots. If the house is repurchased, the resident will receive only the deposit plus interest calculated at the average interest rate of a one-year fixed deposit.

Meanwhile, the scope of public sale houses subject to the residence obligation has been expanded from the previous "houses supplied by releasing more than 50% of the development restriction zone in the Seoul metropolitan area" to "houses supplied on public land in the Seoul metropolitan area."

Detailed procedures have also been established, such as requiring residents who violate the mandatory residence period or fall under exceptional resale reasons to submit a purchase application form to the public housing operator. Residents who violate the residence obligation will be given an opportunity to provide necessary explanations within a period of at least fifteen days.

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