Yang Seung-jo, Governor of Chungnam Province, Proposes Decentralization of Social Housing Supply and Housing Policy Authority to Local Governments

Yang Seung-jo, Governor of Chungnam Province, is delivering the keynote speech at the "National Assembly Policy Forum on Resolving Housing Polarization" on the 21st. Provided by Chungnam Province

[Asia Economy (Hongseong) Reporter Jeong Il-woong] Yang Seung-jo, Governor of Chungnam Province, proposed expanding the supply of social housing and transferring housing policy authority to local governments as measures to resolve housing polarization.

On the 21st, Chungnam Province jointly held a “National Assembly Policy Forum to Resolve Housing Polarization” with 31 members of the National Assembly.

The forum was held under the theme of “Decentralization of Housing Policy Authority to Resolve Polarization,” and proceeded in the order of Governor Yang’s keynote speech, a presentation by Professor Jeong Seong-hoon of Daegu Catholic University, and participant discussions.

In his keynote speech, Governor Yang diagnosed, “Over the five years since 2015, the average monthly household income increased by 20%, from 4.37 million won to 5.27 million won, while apartment prices rose by 48%, from 270 million won to 400 million won during the same period.” He added, “This widening asset gap has led to the emergence of new terms such as ‘Yeongkkeul’ (borrowing to the limit), ‘Debt Investment,’ and ‘Sudden Poverty,’ accelerating housing market polarization that increases household debt and concentrates housing assets.”

He also pointed out the causes of housing polarization as ▲ simultaneous increase of both non-homeowners and multi-homeowners ▲ polarization among housing owners ▲ polarization between the metropolitan area and non-metropolitan areas ▲ generational disconnection and social polarization.

He then questioned, “If people have to feel wealth disparity even in minimal housing welfare while struggling with poor working conditions and unfair income levels as non-regular workers, can the public truly feel happiness?” He advocated for expanding the introduction of social housing, as seen in Europe, as a way to overcome housing polarization.

Social housing has the advantage of increasing rental housing supply while reducing public sector fiscal expenditure by utilizing private capital. For example, the implementer reduces project costs by receiving benefits such as land lease, financing, and tax reductions from the public sector, and the public provides housing services to tenants at rents lower than market prices.

In Europe, the proportion of social housing is already high, and housing supply is actively carried out mainly by local governments or non-profit organizations rather than the central government. Reflecting this, Governor Yang argued that South Korea also needs to introduce a social housing model based on cooperation between local governments and the private sector and devise effective policy support measures.

In fact, Chungnam is promoting the ‘Chungnam-type Happier Housing’ project based on social housing. Chungnam-type Happier Housing is supplied at costs lower than market prices, mainly for newlyweds. Above all, this housing is considered a key regional project to overcome low birth rates by reducing rent when the resident couple has children (free rent upon the birth of two children).

Governor Yang also proposed transferring housing policy authority held by the central government to local governments. He appealed, “The government’s housing policy is rigid and takes a long time to establish and implement because it is difficult to consider the characteristics of each region.” He added, “Conversely, if housing policy authority is transferred to local governments, the speed of project progress will be faster than before, and customized projects for residents will become possible.”

He further stated, “Chungnam has been pursuing new model policies that include social functions such as solving the low birth rate problem, moving away from the ‘housing projects focused on residential functions’ promoted in Seoul and the metropolitan area.” He added, “Through this, we are putting into practice customized housing welfare for young people struggling with jeonse (key money deposit) difficulties and employment challenges.”

Meanwhile, based on the contents discussed at the forum, the province plans to propose the decentralization of housing policy authority to the central government and promote legislative amendments and the preparation of bills in the National Assembly.

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