(ATTN: UPDATES with finance minister’s remarks in last 4 paras)
The Ministry of Land, Infrastructure and Transport said on Tuesday that in addition to the existing 2.7 million new homes plan for 2023-27, the South Korean government will provide 120,000 public homes in an effort to counter the decreasing private-sector home supply due to higher lending rates.
The plan, released in August of last year, permits the private sector to participate in downtown development projects and relaxes regulations for redevelopment and reconstruction.
The ministry noted that while the 2.7 million home plan is expected to help ease the lack of homes in preferred residential areas in the mid and long term, market conditions for new homes in the private sector began to deteriorate in the second half of last year.
This file photo taken Aug. 15, 2022, shows the Hyundai apartment complex in Apgujeong, southern Seoul. (Yonhap)
In order to offset this shortage, the government will supply 30,000 homes in large residential towns near the capital city of Seoul and 85,000 in newly developed areas. The first 30,000 homes could be delivered as early as next year, depending on construction permits, while the rest are expected to be supplied by 2027.
The government also plans to provide 1.58 million homes in Seoul and metropolitan areas, and 1.12 million houses in other provinces from 2023-27 to stabilize the real estate market. This year, the government aims to provide 470,000 public homes and will increase the number to more than 1 million next year.
Finance Minister Choo Kyung-ho said the government will make every effort to find a soft landing of the property market by expanding the supply in the face of looming concerns over housing shortages.
“The property market has been showing signs of a soft landing in general, but there have also been price hikes in some areas,” Choo told reporters. “Some are voicing concerns that the housing supply may fall short in the coming two to three years due to delayed approvals and sluggish construction,” Choo added.
The measures announced Tuesday will focus on providing quality houses sufficiently at locations with high demand.
kyongae.choi@yna.co.kr
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