SH Corporation "Public Rental Housing, Annual Housing Cost Reduction Effect of 1.2 Trillion KRW"

An analysis revealed that the reduction in housing costs for Seoul citizens due to the supply of public rental housing by Seoul Housing and Communities Corporation (SH Corporation) amounts to approximately 1.2 trillion KRW annually.

On the 7th, SH Corporation disclosed the results of an analysis on the contribution to housing cost reduction for 138,295 public rental housing units owned by the corporation. According to SH Corporation, the rental fees (rental deposit and rent) for SH public rental housing are about 34.7% of private market prices. The resulting contribution to housing cost reduction was 1.2381 trillion KRW per year. This figure has steadily increased since 2012 (approximately 341.8 billion KRW).

When including public rental housing owned by Seoul City and REITs managed by SH Corporation, the contribution to housing cost reduction rises to 2.0219 trillion KRW (227,986 units).

By type of rental housing, long-term lease housing showed the highest reduction effect at 12.42 million KRW per unit. This increased 8.4 times from 1.47 million KRW per unit in 2012 to 12.42 million KRW per unit in 2023, indicating a greater housing cost reduction effect compared to other types. This was followed by national rental housing at 11.47 million KRW per unit, redevelopment rental housing at 9.42 million KRW per unit, and permanent rental housing at 8.66 million KRW per unit.

However, SH Corporation stated that measures are needed to enhance the sustainability of public rental housing operations. While operating costs and taxes related to rental housing increase annually, rental income remains only 4 to 34.7% of market prices, worsening the business balance. The corporation plans to propose to the government and the National Assembly exemptions from property taxes on public rental housing and compensation for the difference from market prices.

Kim Heon-dong, President of SH Corporation, said, “It is necessary to improve policies so that more housing-vulnerable groups can reside in public rental housing, which has significant social contributions, by exempting property taxes or providing equivalent government support.”

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