Emerging 'Maeipyakjeong Public Jeonse'... "We Will Provide Apartment-Level Quality"

Public rental housing under purchase agreement in Jangan-gu, Suwon-si, Gyeonggi Province, disclosed by LH on the 3rd. The government plans for LH to supply 28,000 units of 'public jeonse housing' with apartment-level quality by 2022. (Provided by LH)

[Asia Economy Reporter Lee Chun-hee] A housing unit that gives a preview of the 'public jeonse housing' announced by the government in the November 19 rental housing plan has been unveiled.

Korea Land and Housing Corporation (LH) revealed a housing unit on the 3rd that allows people to experience public jeonse housing in advance. The unit unveiled that day is an officetel located in Songjuk-dong, Jangan-gu, Suwon-si, Gyeonggi Province. It is a 75-81㎡ (exclusive area) unit consisting of 48 households, with 3 bedrooms and 2 bathrooms, spanning from basement level 2 to the 9th floor above ground. It is a newly constructed officetel completed in December last year, purchased in June to supply to families with two or more children, and is currently recruiting tenants.

However, this housing unit operates as a purchased rental housing with a deposit of 12 million KRW and monthly rent ranging from 300,000 to 440,000 KRW. LH purchased it for 13.2 billion KRW, which is about 280 million KRW per household. Since it was purchased immediately after construction, no separate repairs were made.

An LH official explained, "When converted to a jeonse deposit, it would be set at about 180 million KRW," adding, "This was introduced with the intention of supplying public jeonse housing of a similar scale." According to LH, the jeonse market price near Songjuk-dong is cheaper compared to nearby prices, with villas of similar size priced between 250 million and 300 million KRW, and apartments around 400 million KRW for 59㎡ units.

In terms of location, it is situated in an area with well-developed bus routes including express buses to Seoul and buses covering the entire Suwon area. The Sinbundang Line extension's Suseong Jungsagori Station is planned to open within 700 meters walking distance, making transportation convenient. Various amenities such as large marts, cinemas, Manseok Park, and Suwon Sports Complex are also nearby.

Public rental housing under purchase agreement in Jangan-gu, Suwon-si, Gyeonggi Province, disclosed by LH on the 3rd. The government plans for LH to supply 28,000 units of 'public jeonse housing' with apartment-level quality by 2022. (Provided by LH)

The government and LH plan to supply 18,000 units of such public jeonse housing nationwide by 2022. This includes 13,000 units in the metropolitan area and 5,000 units in Seoul. In particular, the support price per household for existing purchased rental housing, currently up to 300 million KRW (average 120 million KRW), will be raised to a maximum of 800 million KRW (average around 600 million KRW) in Seoul, securing medium-sized housing with three or more rooms in high-demand urban areas.

Since the supply targets the middle class, anyone without a home can apply regardless of income or assets. In case of competition, tenants will be selected through a random lottery. Residents can live for up to six years at less than 90% of the nearby deposit market price.

LH will be responsible for supplying most of the units. To secure high-quality new housing, LH is focusing on a purchase agreement supply method through private construction companies. LH signs a purchase agreement before completion with private developers for planned or under-construction housing and purchases it at the appraised price after completion.

LH plans to present design and quality standards in advance and conduct inspections at major stages to secure high-quality housing. Through this, they aim to ensure apartment-level interior quality while also equipping various safety devices such as CCTV, seismic design, fire detectors, and emergency escape devices.

From the perspective of private construction companies, LH explains that there are advantages such as no sales risk and no concerns about financing. Incentives are also provided. Construction funds with low interest rates in the 1% range per annum are supported using the Housing and Urban Fund, and priority supply and additional points are given during bidding for multi-family housing sites. Capital gains tax and acquisition tax are each reduced by 10%. LH plans to hold the first business briefing sessions in the metropolitan area from the 10th to the 14th and a second briefing session within this year.

Kang Gi-gwan, head of LH's Housing Welfare Business Division, said, "Public jeonse housing is scheduled to be supplied with 18,000 units over two years, and LH will be responsible for a significant portion of this. We will do our best to supply in key areas of Seoul and the metropolitan area to help alleviate the jeonse housing shortage."

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