Can Kim Heondong's SH Land Lease Department, Pushed by Oh Sehun, Make 'Half-Price Apartments' Possible?

Assemblyman Nosikrae Points Out Limitations of Kim Heondong's Half-Price Apartment at Hearing on the 10th; Opposes Land Lease Housing Citing High Future Burden and Potential Conflicts

Assemblyman Noh Sik-rae (right) is asking questions to Kim Heon-dong, the SH Corporation president nominee, at the hearing on the 10th.

[Asia Economy Reporter Park Jong-il] Despite being eliminated in the first round, will Kim Heon-dong, the candidate for SH president pushed by Seoul Mayor Oh Se-hoon, ultimately be able to realize the land lease-type 'half-price apartments'?

Despite opposition from real estate experts and Seoul city council members, Mayor Oh is expected to proceed with appointing Kim Heon-dong as SH president.

However, the prevailing view is that the sale of land lease-type apartments will by no means be easy.

On the 10th, Seoul City Council member Noh Sik-rae (Democratic Party, Yongsan 2) drew attention by pointing out the limitations of land lease-type housing sales during the confirmation hearing for candidate Kim Heon-dong.

Noh, who previously chaired the confirmation hearing for former SH president candidate Kim Hyun-ah, cited the example of Jungsan Shibeom Apartments in Ichon-dong, currently undergoing reconstruction, to highlight the limitations of land lease-type housing.

On that day, Noh Sik-rae stated, “The land lease-type housing proposed by the candidate as a way to realize half-price apartments places a heavy burden on future generations at the reconstruction stage and is prone to disputes,” calling for a review of institutional improvements.

Jungsan Shibeom Apartments is a 7-story, 6-building complex with 228 households, completed in 1970. It received a disaster risk diagnosis grade D in 1996 and obtained approval for a reconstruction promotion committee in 2004 but has yet to establish a union. Although the buildings are owned by residents, the land is owned by Seoul City as it is a 1970s land lease-type housing.

Due to continuous resident demands for land sales, Seoul City decided in 2017 to sell the land ownership, but since 100% resident consent was required, purchasing the land was practically impossible.

This year, following Noh Sik-rae’s suggestion, the condition was changed so that if over 75% consent is obtained per building, the sale proposal can be submitted to the Shared Property Deliberation Committee.

Noh Sik-rae argued, “Due to these limitations of land lease-type housing, the effect on stabilizing the housing market will not be significant.” Although the plan is to reduce land costs to significantly lower sale prices, in reality, residents bear land costs through lifelong installments and face a double burden of a lump sum payment again at reconstruction time.

Additionally, Noh questioned the candidate on issues such as the constant disclosure of sale costs and the prohibition of public land sales, and asked how the candidate would respond if their convictions conflicted with Mayor Oh Se-hoon’s position.

Noh Sik-rae also criticized, “The candidate’s YouTube and media interviews are excessively hostile and aggressive,” demanding “flexibility of thought and a calm, prudent attitude.”

After the confirmation hearing, the special confirmation committee passed the confirmation report with a 'disqualification' opinion.

Meanwhile, a high-ranking former Seoul city official and real estate expert, Mr. A, stated, “It seems like a simple calculation to sell 30-pyeong land lease-type apartments at around 300 million KRW, but actually selling them will never be easy.”

He particularly argued that if land lease-type apartments are sold on the sites of the former Seoul Medical Center in Gangnam or the former Seongdong Detention Center in Songpa, the large price gap with nearby apartment market prices would cause resident backlash and social controversy over the huge capital gains for buyers.

Nonetheless, attention is focused on how Mayor Oh Se-hoon will overcome future social controversies if he pushes through with appointing Kim Heon-dong as SH president.

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