Government: "Unprecedented Success of 2·4 Measures"... Cash Settlement Bomb and Resident Conflicts Still Remain

One Year of the 2·4 Plan for Rapid Urban Supply

Hong Nam-ki, Deputy Prime Minister and Minister of Economy and Finance, is speaking at the meeting of related ministers to review the real estate market held on the morning of the 3rd at the Government Seoul Office in Jongno-gu, Seoul.

On the first anniversary of the government's 2·4 Plan aimed at rapid housing supply within urban areas, Deputy Prime Minister and Minister of Strategy and Finance Hong Nam-ki self-assessed on the 3rd that it has "achieved unprecedented results."

In his opening remarks at the real estate market inspection meeting held at the Government Seoul Office that morning, Deputy Prime Minister Hong said, "About one year after the announcement of the plan, we have selected candidate sites for 500,000 housing units, which is 60% of the target volume of 836,000 units." However, controversy continues on the effectiveness of government-led supply efforts in the field. It takes a long time to see tangible housing supply, and there are still conflicts among residents in the areas designated as candidate sites regarding whether to proceed with the projects.

The 2·4 Plan aims to supply 836,000 housing units in major metropolitan areas nationwide, including 320,000 units in Seoul, through public participation, business feasibility enhancement, and procedural shortening. Deputy Prime Minister Hong explained, "Immediately after the announcement, the volume effect eased short-term market instability, and from the second half of last year, as candidate sites and districts were officially designated, it played a key role in the recent downward stabilization trend of the market." Previously, the government had pursued demand suppression policies under the claim that "supply is not insufficient," but the shift to a "supply policy" with the 2·4 Plan is regarded as a desirable transition. However, negative outlooks still dominate in the field.

One notable issue is that conflicts among local residents are observed in most project sites. Jung-sang 4 District and Yeonsinnae Station are representative examples. In the case of urban complex projects, only 7 out of 76 candidate sites (about 10,000 housing units) have been designated as main districts. According to the '3080 Public-led Opposition National Union,' formed by residents opposing the 2·4 Plan, withdrawal demands against candidate site designations have emerged in about 40 of the 76 urban complex project candidate sites.

There is also considerable resistance to the government-led project model. The government decided that those who acquired real estate in the relevant areas after the law's passage on June 29 last year would not receive occupancy rights but would be compensated in cash. Recently, a post appeared on the Blue House's public petition board stating, "I bought a villa with money I saved all my life, but now I am being labeled a speculator and am in danger of being evicted."

Public direct implementation redevelopment projects, which offer exceptional conditions such as exemption from the reconstruction excess profit recovery system and a two-year residency obligation for association members, have also shown limited results. So far, only two candidate sites have been selected: the reconstruction of Sinan Villa in Magok, Gangseo, Seoul, and Naeson Gagu Station in Uiwang, Gyeonggi Province, totaling about 1,000 housing units. The supply targets for 101,000 units, including new construction purchase agreements and non-residential remodeling included in the 2·4 Plan for short-term housing expansion, are also falling short.

Given the current difficulty in supplying housing within urban areas, there are calls to temporarily alleviate the supply shortage by encouraging multi-homeowners to put their properties on the market. Seo Jin-hyung, president of the Korea Real Estate Society and professor at Gyeongin Women's University, said, "To maximize the market stabilization effect, multi-homeowners' properties should be induced into the market through measures such as capital gains tax relief." He added, "While implementing government-led supply policies, a two-track strategy should be pursued to also encourage private properties to enter the market."

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