Former Minister Byun Chang-heum: "Redevelopment Projects Have Limits in Controlling Housing Prices... Inclusive Housing Supply Needed"

One Year of the Lee Administration: Real Estate Normalization Forum

"Redevelopment Projects Undermine Housing Stability for Original Residents

Need for Measures to Share Development Gains

Inclusive Housing Policy Centered on Mid-Rise, High-Density Development Needed"

Former Minister of Land, Infrastructure and Transport Byun Chang-heum stated that private redevelopment projects are, in fact, causing unintended side effects by fueling rising housing prices, emphasizing the need for an inclusive housing policy centered on mid-rise, high-density development.

On April 23, at a real estate normalization forum hosted by Lee Yeonhee, a member of the Land, Infrastructure and Transport Committee from the Democratic Party, Byun said, "Through redevelopment projects, high-priced apartments costing around 2 billion KRW per pyeong are being supplied in prime locations in Seoul, which is resulting in inflated overall housing prices."

On the 23rd, a Real Estate Normalization Forum hosted by Lee Yeonhee, a member of the National Land, Infrastructure and Transport Committee from the Democratic Party, was held. Photo by Lee Ji-eun

He pointed out that redevelopment projects are actually undermining housing stability. Byun explained, "Due to excessive move-in costs, only about 20 to 30 percent of original residents are able to return to areas after redevelopment. This means that original residents are forced to worry about where they will relocate after the project is completed."

Byun also criticized the fact that redevelopment associations are monopolizing the massive development gains. He said, "It has become commonplace for association members to reap tens of billions of won in profits the moment they are allocated new units," stressing, "We need to find ways to share these profits, such as recovering development gains from redevelopment projects and using them as funds."

As an alternative, he proposed moving away from a housing supply system centered on redevelopment projects and adopting an 'inclusive housing policy' based on public interest and inclusiveness. As a concrete example, he cited mid-rise, high-density development. Byun elaborated, "Even if profitability is low, we need to strategically designate areas that require housing supply as 'housing supply promotion districts,' push for mid-rise, high-density development, and create housing types that allow residents to move in with only minimal financial burden."

He also emphasized the need to address the shrinking supply of non-apartment housing to solve the housing shortage. According to Byun, the number of non-apartment construction permits dropped sharply from 740,000 units in 2016 to 410,000 units last year. "In reality, aside from the units purchased for lease by Korea Land & Housing Corporation (LH), there is virtually no supply of non-apartment housing," he said, adding, "Building new towns and redeveloping existing areas alone will not fundamentally resolve the housing shortage."

Meanwhile, at the forum, some criticized the real estate policy of the Lee Jaemyung administration as being only a superficial fix to current issues. Lee Kwangsoo, CEO of Kwangsoone Bokdeokbang, commented, "What the Lee Jaemyung government has put forward over the past year is not a policy but merely a response to market conditions," emphasizing that "there needs to be clear policy direction and established goals for the real estate market."

Choi Eunyeong, Director of the Korea Urban Research Institute, also pointed out the ambiguity of government policy. Choi said, "It is not normal to learn about the President's housing policy direction through social media," and expressed regret that "there has not yet been an announced housing welfare roadmap, and there is a lack of discussion, public debate, and feedback collection on the government's fundamental housing principles."

In response, the Ministry of Land, Infrastructure and Transport stated, "We are continuously reviewing ways to activate supply measures," adding, "We will present a related vision as soon as the conditions are ready."

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