"Dual-Income Newlyweds Eligible for Special Housing with Annual Income of 106.68 Million Won"...Eased Income Criteria

Dual-income family with one child eligible for special housing purchase up to 8.89 million KRW/month
Related legal amendments to be finalized by January next year
Increased opportunities for newlyweds and first-time buyers expected

[Asia Economy Reporter Moon Jiwon] The government has further relaxed the income requirements for newlyweds and first-time special supply (special allocation) by an additional 20-30 percentage points. The income requirement for the Newlywed Hope Town sales will also increase by 10 percentage points.

As a result, households that previously could not even apply for public or private housing special allocations due to not meeting the income criteria are expected to have more opportunities. For example, dual-income couples with one child will be able to apply for the newlywed special supply if their annual salary is up to 106.68 million KRW.

On the morning of the 14th, the Ministry of Land, Infrastructure and Transport held the 8th Real Estate Market Inspection Ministerial Meeting at the Government Seoul Office, chaired by Deputy Prime Minister and Minister of Strategy and Finance Hong Nam-ki, and announced that it will begin the process of revising related laws to relax the income requirements for newlyweds and first-time special supply.

The purpose of this system improvement is to expand the opportunity for homeownership for actual demanders without homes who have not had the chance to apply for special supply due to not meeting income requirements.

Currently, for private housing, the income standard for newlywed special supply is 100% of the average monthly urban worker income (120% for dual-income) for 75% of the quota (priority supply), and 120% (130% for dual-income) or less for the remaining 25% (general supply). For general supply, the standard is relaxed to 130% (140% for dual-income) only when purchasing a home priced at 600 million KRW or more for the first time in life.

Going forward, the priority supply ratio will be adjusted from 75% to 70% and operated under the same criteria as now, while the general supply ratio will increase to 30%, and the income criteria will be relaxed to 140% (160% for dual-income).

As a result, households with a pre-tax monthly income of up to 7.78 million KRW (8.89 million KRW for dual-income) based on a household of three or fewer members will also be able to apply for the newlywed special supply. Converting 8.89 million KRW per month to annual salary equals 106.68 million KRW.

For public sale housing, the current income requirement is 100% (120% for dual-income) or less. The government plans to subdivide public sales into priority supply (70%) and general supply (30%), applying the existing 100% (120% for dual-income) or less for priority supply, and relaxing the income criteria to 130% (140% for dual-income) for general supply.

In particular, for the 30% of supply where income criteria are relaxed, the existing resident selection method, which selects applicants based on scores according to income, number of children, and subscription savings payment frequency, will be supplemented by introducing a lottery system.

Currently, Newlywed Hope Town opportunities are given only to newlyweds with incomes at or below 120% (130% for dual-income), and the standard is relaxed to 130% (140% for dual-income) only when purchasing a home priced at 600 million KRW or more for the first time in life. Going forward, a uniform standard of 130% (140% for dual-income) or less will be applied.

Along with this, the Ministry of Land, Infrastructure and Transport will also relax the income requirements for first-time special supply.

Currently, the income requirements for first-time special supply are 100% or less for public sale housing and 130% or less for private housing, but going forward, 70% of the supply will be given priority to those who meet the existing income requirements, and the remaining 30% will have significantly relaxed income requirements.

Accordingly, for the remaining 30%, public sale housing will allow applicants with incomes up to 130%, and private housing will allow newlyweds with incomes up to 160% to apply.

The Ministry plans to immediately begin the process of revising related laws such as the Housing Supply Regulations and the Enforcement Rules of the Public Housing Special Act and complete it by January next year.

A Ministry official explained, "With this system improvement, it is expected that more actual demand groups, such as dual-income households, will have opportunities to own homes through the expanded housing supply under the August 4th supply plan and the 3rd phase new town pre-subscription."

[Image source=Getty Images]

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