2500 Rental Officetel Units for Youth and Newlyweds to Be Supplied in Osan Segyo 2 District

Osan City and LH Sign MOU for 'Purchase Agreement' Rental Housing Supply
Construction by Builders, Purchase by LH, and Rental Supply to Young Adults and Newlyweds

A rental officetel complex with 2,500 units for young adults and newlyweds is planned to be supplied in Segyo 2 District, Osan-si, Gyeonggi-do. This project follows the 'purchase agreement rental housing' model, where Korea Land and Housing Corporation (LH) signs a prior purchase agreement with construction companies, sells the land, and then repurchases the completed housing to lease it to tenants.

According to Osan City and LH on the 25th, the two organizations signed a 'Memorandum of Understanding (MOU) for Early Construction of Purchase Agreement Rental Housing' on the 24th, which includes these details. Through this MOU, the city will shorten the permit period through integrated review to facilitate early construction and occupancy of the purchase agreement rental housing. LH will strive to secure community facilities to promote the welfare of residents and ensure smooth progress of the purchase agreement rental housing project.

Lee Gwon-jae (right), Mayor of Osan, and Kwon Woon-hyuk, Head of the Korea Land and Housing Corporation (LH) Southern Gyeonggi Regional Headquarters, are holding up a business agreement to promote the supply of purchase-commitment rental housing. Provided by Osan City

This project targets five unsold commercial and office facility lots within Segyo 2 District. The total expected scale of the officetel construction is 2,500 units. Previously, LH had reserved sales contracts with multiple construction companies for land sales at the end of last year.

The project applies the 'purchase agreement' method newly introduced by LH last year to expand the supply of purchase rental housing. Construction companies enter into agreements with LH while the land is still vacant, purchase the land, build housing, and after completion, LH repurchases the housing at a pre-determined price to supply it as rental housing. The purchase price of the housing is calculated not only based on the existing appraised value but also linked to construction costs. After verifying the construction cost details submitted by the construction company, a purchase price is set by adding a certain profit margin.

It is said that Mayor I Gwonjae of Osan City strongly reflected his will in this project. To realize the project, Mayor I initiated a survey on the housing status of young people and newlyweds in Osan. According to the survey report, the young population in Osan City has been declining since 2021. Notably, a significant portion of young people moving out relocated to nearby Hwaseong City, including Dongtan New Town, due to housing issues.

Based on the survey results, Mayor I proposed to LH the need to expand rental housing supply, citing Osan City's proximity to the national industrial complex for advanced system semiconductors in Yongin Idong and Namsa, where Samsung Electronics’ semiconductor production lines will be established, as well as the potential for job growth due to the creation of an advanced techno valley and allocation of new industrial complex volumes.

Mayor I emphasized, "To build a self-sufficient city of 500,000 people, it is important to attract young adults and newlyweds who will actively engage in economic activities," and added, "I will personally oversee the project to ensure it proceeds smoothly."

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