Won Hee-ryong: "Rapid Increase in Real Estate Holding Burden... Discussion on Revising Officially Announced Price Realization Plan"

[Image source=Yonhap News]

[Asia Economy Reporter Kim Min-young] Won Hee-ryong, Minister of Land, Infrastructure and Transport, announced on the 10th that he will conduct in-depth discussions on revised measures to lower the burden of real estate ownership by adjusting the official property price realization.

In his opening remarks at the 3rd Real Estate Related Ministers' Meeting held at the Government Seoul Office in Jongno-gu, Seoul, Minister Won said regarding the plan to revise the official price realization, "Given that the rapid rise in housing prices combined with a steep increase in the realization rate has sharply increased the burden of real estate ownership on the public, we will have in-depth discussions at today's meeting on fundamental ways to reduce this burden."

This is interpreted as a response to the recent increase in the phenomenon of apartment official price reversals amid falling housing prices due to an unprecedented drop in real estate transactions this year caused by sharp interest rate hikes and recession concerns.

He also emphasized the active lifting of regulated areas to induce normalization of real estate transactions. Minister Won Hee-ryong stated, "This time, all areas except for four regions?Seoul and the adjacent cities of Gwacheon, Seongnam, Hanam, and Gwangmyeong?will be deregulated." Regarding the additional easing of regulated areas, Minister Won explained, "We actively considered the fact that housing prices in the metropolitan area have been falling for 27 consecutive weeks, transactions have sharply decreased making it difficult for genuine buyers to conduct normal housing transactions, and the rapid rise in interest rates has significantly increased the housing cost burden on ordinary citizens."

He also stressed that sufficient financial support will be provided to prevent housing construction projects from being disrupted due to concerns over project financing (PF) defaults triggered by Legoland.

Minister Won said, "We will newly promote loan guarantees worth 5 trillion won for sites struggling with unsold units," adding, "Even for projects with unsold units before completion, guarantees will be supported to enable PF loans on the condition of self-help efforts such as price discounts."

Furthermore, the HUG PF guarantees, which have been underutilized so far, will have their guarantee eligibility requirements relaxed and the guarantee scale expanded to around 10 trillion won.

Considering the recent decline in subscription demand, Minister Won also announced that the pre-subscription obligation for land to be sold to the private sector in the future will be abolished. Accordingly, the volume of private pre-subscription units is expected to decrease from the originally planned 74,000 households to about 15,000 households by 2024.

Along with this, he stated that ongoing research projects aimed at improving safety inspections to expand the mid- to long-term urban supply base and normalizing registered rental housing for safe and long-term residence will be promptly completed, with improvement plans to be announced next month.

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