Korea Land and Housing Corporation (LH) announced on the 9th that it plans to purchase more than 50,000 new dwellings this year to expand housing supply and stabilize the rental market.
This follows the 'Housing Supply Expansion Plan for National Housing Stability' announced by the government in August of last year. The Ministry of Land, Infrastructure and Transport announced that it will purchase a total of 100,000 dwellings + α from last year to this year and pursue unlimited supply until non-apartment supply normalizes in Seoul.
LH implemented the announcement for new purchase rental dwellings on the 2nd of this month. This is two months earlier than the start of the project last year. To expedite projects, LH has strengthened its organization and workforce, as well as improved purchase standards.
LH plans to significantly reinforce dedicated organizations and personnel this year to facilitate early construction and supply of new purchase rental dwellings, while also introducing a field-oriented quality management system.
In the metropolitan area headquarters, where the purchase volume is concentrated, a dedicated organization for purchase rentals called the 'Purchase Rental Business Division' will be established. Within the 'Purchase Rental Business Division', teams for 'Early Construction Support' and 'Purchase Quality Management' will be organized, expanding into a one-stop system that can carry out everything from dwelling purchases to early construction support and quality management.
The personnel responsible for purchase rentals at the metropolitan area headquarters will be increased to 272 this year. Last year, the number of responsible personnel was increased from 87 to 228.
Various measures have also been established to invigorate the new purchase rental business. LH will apply a construction cost-linked method for dwellings with more than 50 units in the metropolitan area. To expand participation from excellent private contractors, purchase criteria will be relaxed and calls for specialized purchase rental contractors will be expanded. The construction cost-linked method determines land prices through appraisal and building prices through external cost calculation agencies.
Moreover, the regulation that limited the annual number of purchases to four per contractor will not apply this year. The specialized purchase rental contractor selection, which was held twice a year, will be converted to accept applications year-round from this year, significantly expanding opportunities for contractor participation. Specialized purchase rentals allow private contractors to freely plan housing operation themes for specific residents, select residents after construction, and provide housing services.
The quality of the dwellings will also be improved. LH will establish tailored design and construction standards suitable for non-apartments, considering the characteristics of new purchase rental dwellings, and will present standard design layouts to contractors to shorten design periods. To induce early construction and manage construction duration appropriately, suitable construction periods will also be proposed based on building sizes. Additionally, LH will implement collaboration systems with external construction project management companies for quality control, varying quality inspection frequencies based on building scale, and introducing smart construction management systems.
Acting Director Yu Byeong-yong of the Housing Welfare Division said, 'LH will focus on achieving its purchase rental goals to quickly address gaps in housing supply from the private sector and contribute to the housing stability of the underprivileged.'