"Contract Cancellation and Refund Difficulties"... Frustrated Taeyoung Construction Buyers

Worried About Not Moving In
Hard to Find a New Contractor
Refund Conditions Are Also Strict

"What if the interim payment loan is not approved?", "Wouldn't refund execution be better than fulfilling the sale?"

Contractors who purchased apartments being built by Taeyoung Construction are sighing deeply. While most buyers are anxious about the possibility of not being able to move in on the scheduled date, those wishing to cancel their contracts are expressing dissatisfaction with the stringent refund conditions.

On the 18th, at the Taeyoung Construction headquarters in Yeouido, Seoul. Photo by Jinhyung Kang aymsdream@

Additionally, several complexes are considering changing contractors due to the decline in apartment brand image following workout applications, but due to high interest rates, rising raw material costs, and a sluggish real estate market, it is expected to be difficult to find new contractors, deepening the concerns of buyers.

According to the Ministry of Land, Infrastructure and Transport on the 29th, among the housing projects currently under construction by Taeyoung Construction, there are 22 projects with sales contracts totaling 19,869 households. Of these, 14 sites (12,395 households) are covered by the Housing and Urban Guarantee Corporation (HUG) sales guarantee. Six complexes are projects ordered by public entities such as the Korea Land and Housing Corporation (LH), where joint contractors can be engaged as needed. The remaining two projects are trust companies or regional housing cooperatives.

The government has decided to support these projects by protecting sales contract holders, implementing refund measures for sales payments, and promoting contractor replacement, restructuring, or sales for projects facing difficulties in normal progress to ensure completion without setbacks.

Perspective view of 'Uiwang Centline Desiang' sold by Taeyoung Construction

However, buyers of Taeyoung Construction housing projects are voicing dissatisfaction, saying that the government's measures lack effectiveness. In particular, there are ongoing criticisms that the refund application conditions are too stringent, making them ineffective.

In fact, to receive a refund under the sales guarantee system, the site must be recognized as a "guarantee accident" according to HUG's guarantee terms. A workout alone does not qualify as a sales guarantee accident. A guarantee accident is recognized only if construction has stopped for more than three months and it is confirmed that construction progress is difficult. Also, if the construction progress rate is 80% or higher, there is generally no major problem with refund execution, but for projects below 80%, consent from two-thirds or more of the sales contract holders is required.

As a result, in buyer communities of Taeyoung Construction sales complexes (such as open chat rooms), conflicting opinions have clashed all day over whether refund execution or sale fulfillment is better.

In projects promoted by trust companies or regional housing cooperatives, buyers are demanding contractor replacement, but realistically, it is a difficult situation, causing difficulties for the developers. Due to rising construction costs and a downturn in the real estate market, even projects in the Seoul area find it difficult to replace contractors, as there are no construction companies willing to take over troubled projects.

Taeyoung Construction has stated its intention to continue construction as much as possible. A Taeyoung Construction official explained, "Even if we enter workout, only financial debts are frozen, and there is no problem with payment for construction costs," adding, "Unless there are separate demands based on the client's contract conditions, we will carry on the projects currently underway without stopping construction as much as possible."

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