GOV'T UNVEILS HOUSING SUPPLY PLAN

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The government announced a plan to provide additional 830,000 housing units nationwide by 2025. This ambitious plan is to be achieved by dramatically relaxing the regulations on public construction. Up to 80% of the new houses will be up for sale.

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Reconstruction has been one major way to supply more housing. These seven apartment complexes received advanced consulting but none has yet decided to go ahead with redevelopment.

[Soundbite] Kim Mi-chelle(Preparatory Committee for Reconstruction) : "Half of the housing will be public rental. That doesn’t help us much."

So the key to the latest housing policies is dramatically relaxing regulations. If existing residents join a redevelopment co-op, they will be exempted from paying their shares of extra profits gained from rebuilding. Also, they will be free from the two-year mandatory habitation requirement. The project can begin once a majority of co-op members makes their request. Processes will be streamlined to shorten the rebuilding period to under five years. Regulations for the new plan of building urban housing complexes have eased substantially to develop areas around subway stations, semi-industrial zones and low-rise residential areas. The floor area ratio on residential buildings around subway stations will be raised up to 700% and the percentage of land donation for rental housing lowered to 15%.

[Soundbite] Byeon Chang-heum(Minister of Land, Infrastructure and Transport) : "Land owners will be ensured 10 to 30% higher profit rate. Low-income landowners who can not afford to donate land will be assisted with home ownership and special loans."

Between 70 and 80% of the newly supplied housing will be up for sale to actual home buyers. Application method will also be changed. The percentage of general supply for homes smaller than 85 square meters will be raised from 15% to 50%. Thirty-percent of those houses will be allocated by lottery to those who haven’t owned homes for more than three years.

[Soundbite] Kim Deok-rye(Housing System Team, Korea Housing Institute) : "If people can be less anxious, this plan is capable of providing enough homes to stabilize housing prices in the mid-to-long term."

A Cheong Wa Dae official explained the latest housing supply plan demonstrates the government’s strong commitment to dispel the real estate market’s false expectations.