‘Byeon Chang-heum-pyo’ Housing Supply Plan to Be Released on the 4th... Will It Be the Largest Ever?

The 25th Real Estate Policy by Moon Jae-in Government to be Announced on the 4th... Minister Byeon Chang-heum's First Initiative
Supply Expansion to the Capital Area and Major Cities Nationwide... From Over 300,000 to 500,000 Houses
Market Focuses on Expectations of the Largest Housing Supply Plan in History

[Image source=Yonhap News]

[Asia Economy Reporter Jo Gang-wook] The government will unveil its 25th real estate policy on the 4th. As the first initiative since Minister Byeon Chang-heum took office at the Ministry of Land, Infrastructure and Transport, market attention is focused on expectations that it will include the largest-ever housing supply plan targeting not only Seoul and the metropolitan area but the entire country.

According to the National Assembly and government ministries on the 3rd, the government will announce measures to expand housing supply in metropolitan areas on the 4th.

This policy is highly anticipated to be a drastic large-scale supply plan, as even President Moon Jae-in has announced it in advance. Accordingly, there are predictions that up to 300,000 units will be supplied in Seoul alone, and more than 500,000 units will be supplied nationwide when combining all major cities.

Regarding the supply methods, three main directions are expected to be pursued: high-density development around subway stations in urban centers, designation of new housing sites, and deregulation of reconstruction. Minister Byeon has consistently emphasized high-density development in areas around subway stations, semi-industrial zones, and low-rise residential areas, as well as revitalization of public redevelopment and reconstruction since his candidacy.

While expanding high-density development around subway stations and urban regeneration projects to increase apartment supply in city centers, a new housing supply system is also expected to be included in this plan. Measures to curb speculation, such as designating speculative areas to prevent side effects from the new policy, will also be introduced.

In particular, it is highly likely that the plan will include measures to expand housing supply in metropolitan areas nationwide. Due to rapid price increases in major cities such as the metropolitan area, Busan, Daegu, and Daejeon, the plan aims to enable public redevelopment and reconstruction, as well as high-density development in areas around subway stations, semi-industrial zones, and low-rise residential areas in these cities.

In Seoul, where the housing shortage is severe, it is known that a blueprint for supplying more than 300,000 new apartment units will be presented through easing floor area ratios in subway station areas and semi-industrial zones, and revitalizing reconstruction and redevelopment projects. If expanded to local major cities, it is expected that 500,000 urban apartments can be supplied nationwide.

By upgrading 100 general residential areas near Seoul subway stations to quasi-residential zones, floor area ratios will be relaxed from the previous maximum of 400-500% to up to 700% according to mixed-use plans for subway station areas. Restrictions on apartment height, which were limited due to sunlight and lighting concerns, will also be eased twofold, enabling the supply of high-rise housing. The amendment to the Enforcement Decree of the National Land Planning and Utilization Act containing these details passed the Cabinet meeting last month.

Additionally, the utilization of housing obtained through floor area ratio incentives is planned to be expanded beyond public rental housing to include public sale, repurchase conditions, land lease, and equity accumulation types of public owner-occupied housing. This is because it can significantly increase the proportion of sale apartments among the housing supplied through development projects.

The direction for public development of urban apartments is also emerging. It is suggested that public institutions such as Korea Land and Housing Corporation (LH) or Seoul Housing and Communities Corporation (SH) will take charge of projects, with urban regulations such as floor area ratio, sunlight rights, and parking relaxed boldly, while development profits will be distributed at an appropriate level to landowners or associations.

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