#A construction company based in North Jeolla had a low construction ranking and did not meet the requirements for existing PF (project financing) loan guarantees, but with support from the PF special guarantee, a PF loan of 140 billion won became possible.
#At business sites B in Busan, although the construction progress rate was over 90%, the low pre-sale rate made it difficult to raise the remaining construction costs, but through the assured buyback, it became possible to procure the shortfall in construction costs.
The Ministry of Land, Infrastructure and Transport said on the 12th that the housing industry has responded positively to the special PF guarantees for small and midsize builders and the assured buyback for unsold units, with more than 800 billion won received so far, and it plans to complete support in Nov.
The government previously announced the measure on July 4 as the second supplementary budget and on Aug. 14 as a plan to reinforce construction investment centered on local governments.
The PF special guarantee program lowered the weight of the contractor evaluation (35→ 30 points) and raised the weight of the business viability evaluation (65→ 70 points) compared with existing PF loan guarantees, to support business sites built by small and midsize builders ranked outside the top 100.
In addition, considering the main funding methods of small and midsize builders, it expanded eligible financial institutions for guarantees beyond existing banks and securities, insurance, and mutual finance institutions to include savings banks, and improved the process so that both screening procedures and guarantee fee rates would be applied favorably.
As a result, within two months of the launch, it approved a total of 675 billion won in PF special guarantees for five small and midsize builders' business sites, and screening is underway for two business sites. About 800 billion won in PF special guarantees is expected to be provided within the year. The government invested 200 billion won this year with the aim of providing a total of 2 trillion won by 2027.
The assured buyback program supplies low-interest funds in the mid-3% to 4% range on a temporary basis to local business sites struggling with funding shortages and project execution due to unsold units, helping ensure the successful completion of dwelling projects. The goal is to support about 240 billion won for 10,000 units by 2028, and this year's government funding and loans total 250 billion won.
Since the first call for applications on Sept. 5, applications totaling 164.4 billion won have been received so far, and after screening in Nov., the plan is to complete funding within the year.
In addition, since Nov. 4, the second call for applications has been underway; starting with this notice, to improve convenience for the housing industry, the application period will not be limited and applications will be accepted on a rolling basis, and support will be provided under improved conditions reflecting suggestions raised by the industry. Specifically, business sites that have not yet met the construction progress threshold may apply on the condition that the threshold is met before funding; the scope of recognized remaining receipts has been expanded, and requirements have been eased to allow preferential support applications by builders ranked within the top 30.
Kim Heon-jeong, director-general for housing policy at the Ministry of Land, Infrastructure and Transport, said, "Through the PF special guarantees and the assured buyback program, we expect to support liquidity of about 1 trillion won or more within this year," adding, "Going forward, we will continue to gather opinions from the housing industry during project implementation and actively support conditions for dwelling supply."