Won Hee-ryong "Considering Solutions to Resolve 'First-Time Homebuyer' Exclusion Issue for Small House Purchases"

The government stated that the upcoming housing supply activation measures to be announced before Chuseok will "focus on enhancing project feasibility rather than cutting taxes to encourage speculation." Regarding the controversial imposition of enforcement fines on 'residential-type lodging facilities' (Saengsuk), the government is reviewing the appropriateness of regulations and hinted at plans to introduce relaxation measures.

Minister of Land, Infrastructure and Transport Won Hee-ryong is meeting with reporters at the Government Sejong Complex on the afternoon of the 18th to answer questions related to current issues. / Photo by Ministry of Land, Infrastructure and Transport

On the afternoon of the 18th, Won Hee-ryong, Minister of Land, Infrastructure and Transport, met with reporters at the Government Complex Sejong and said, "It is appropriate for the market to lead housing demand and supply. The main role of the public sector is to establish a supply foundation, not to say 'take on debt to buy a house.'"

Minister Won added, "Our goal is to secure the total amount of real estate project financing (PF) and provide incentives for guarantee scales to ensure that construction projects operate smoothly overall." He further explained, "We are comprehensively seeking measures to provide public land and reduce construction costs." This shows an awareness of public concerns that rising construction costs might push house prices up again.

He emphasized that financial measures to activate supply will be included for non-apartment housing such as officetels, urban lifestyle housing, and Saengsuk, but these will not include tax reductions.

Minister Won explained, "There is a very large investment demand group that buys multiple officetels for rental or resale profit. We are not signaling to buy officetels by cutting taxes." He added, "From the demand side, there are issues such as exclusion from the special supply for first-time homebuyers after purchasing small-sized housing, causing hesitation in buying a house before having children or increasing house size, and we are considering ways to resolve these." Small-sized housing refers to houses with a public price of 130 million KRW or less in the metropolitan area and 80 million KRW or less outside the metropolitan area, with a net floor area of 60㎡ or less.

Regarding the plan to designate Saengsuk used for residential purposes as illegal residential facilities and impose enforcement fines starting from the 15th of next month, the government plans to prepare and announce measures before Chuseok. The enforcement fine regulation originated in 2021 when lodging business registration became mandatory, and there is controversy over retroactive legislation.

Minister Won said, "The previous government, startled by the rapid rise in house prices, threatened to impose annual fines for life, but we are reviewing whether this is appropriate with a sense of problem awareness." He added, "We must not leave a wrong precedent of 'if you endure, everything will be legalized,' so we will clarify several premises and principles before Chuseok."

Additionally, he stated, "Our goal is to exceed or come close to the overall permit volume target by the end of this year," and "By early next year, we will unblock obstacles and boldly revise necessary regulations so that the system can operate normally within 2 to 3 years during my term."

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