With construction's recovery expected to be slow this year and domestic and external uncertainties likely to grow, the government rolled out a range of construction-related policy fixes in response.
The focus is on strengthening the stability and sustainability of the construction industry, including expanding acquisition benefits for dwellings in depopulating areas, reinforcing forest disaster management, completing the chemical safety system, and tightening crackdowns on overloading.
According to the construction industry on the 20th, the government on the 6th published a booklet titled "These changes start in 2026," summarizing systems and regulations that will change starting this year.
Summarizing the newly revised construction-related policies this year, first, if a one-household, one-dwelling owner acquires an additional dwelling in a depopulating area, the "Second Home" program—under which the one-household, one-dwelling special rule is applied to the existing dwelling—will see its eligibility expanded.
Non-capital region areas of interest for depopulation are newly added to the special-rule zones, and the price threshold for dwellings in those areas is set at a standard market price of 400 million won or less.
Areas of interest for depopulation nationwide include: ▲ Geumjeong District, Jung District in Busan ▲ Dong District in Incheon ▲ Dong District in Gwangju ▲ Daedeok District, Dong District, Jung District in Daejeon ▲ Dongducheon, Pocheon in Gyeonggi ▲ Gangneung, Donghae, Sokcho, Inje County in Gangwon Special Self-Governing Province ▲ Iksan in Jeonbuk State ▲ Gyeongju, Gimcheon in North Gyeongsang ▲ Sacheon, Tongyeong in South Gyeongsang.
If the Second Home special rule applies, the existing dwelling can keep the one-household, one-dwelling special rule, maintaining capital gains tax exemption (for properties priced at 1.2 billion won or less) and preferential long-term holding deductions (for those over 1.2 billion won). In the comprehensive real estate tax, owners can also receive the preferential basic deduction (from 900 million to 1.2 billion won) and enjoy tax credit benefits for seniors and long-term holding.
Also, if an owner of two or more dwellings acquires a dwelling in a depopulating area or a non-capital region area of interest for depopulation, the additionally acquired dwelling is excluded from aggravated taxation for capital gains tax and comprehensive real estate tax. The tax rate is applied based on the existing dwellings, excluding the additionally acquired dwelling. However, only dwellings of 900 million won or less in non-capital depopulating areas, and 400 million won or less in other areas, are excluded from the dwelling count.
Starting in February, a prior review system for forest disaster risk will be introduced for construction activities on forests and land adjacent to forests. For construction within 50 meters of a forest, authorities must review risks from forest disasters such as wildfires and landslides at the construction permit and notification stages.
Going forward, when an application for a building permit or a building notification is filed for a site adjacent to a forest, the administrative agency must notify the regional forest service, and the regional forest service must review forest disaster risks and submit its opinion to the relevant administrative agency.
From this year, discretionary felling of wildfire risk trees around buildings adjacent to forests will also be allowed. Until now, felling trees required a permit or notification. Going forward, only risk trees within 25 meters from a building's outer boundary line may be felled at discretion. The aim is to prevent damage to buildings adjacent to forests from large wildfires and to enable swift disaster response.
There are also changes in public dwelling bidding. Starting this year, bidders in public dwelling tenders must prepare cost breakdowns using the Public Procurement Service's bid breakdown authoring program, "PPS-Bid Breakdown Authoring Program" (BID). Cost breakdowns previously prepared with the Korea Land & Housing Corporation (LH) estimate bid authoring program must now be prepared and submitted using PPS-BID.
For Public Procurement Service design competitions, "private-sector architect jurors" will be newly appointed. Design competition juries had been composed mainly of university professors, public officials, and public institution employees. From this year, additional appointments of private-sector architect jurors with strong capabilities and ample experience—such as winning design competitions—will diversify jury composition and enhance fairness and expertise in design competition reviews.
As of the 16th of this month, the grace period ended for submitting material safety data sheets (MSDS) and for confidential business information approvals that had applied to chemical products manufactured or imported in annual quantities of less than 1 ton (t). First introduced on Jan. 16, 2021, the MSDS submission system requires companies to submit to the Ministry of Employment and Labor (MOEL) documents that systematically organize the hazards of harmful substances used at construction and manufacturing worksites and safe handling methods. The government granted a 1–5 year grace period depending on manufacturing/import volumes, and that grace system fully expired this year.
Going forward, business sites that manufacture or import chemical products must submit MSDS to the Ministry of Employment and Labor (MOEL) regardless of the product's manufacturing or import volume. Separate approval is also required to keep components or content levels confidential.
With construction site safety management emerging as a major issue, inspections and crackdowns related to MSDS are expected to be strengthened. Construction sites will likely need to replace their documents with the latest MSDS that include submission numbers in step with the end of the grace period.
Starting in January, procedures to check related documents were also made mandatory to identify the actual responsible party for violations involving overloaded vehicles. Bills of lading, cargo specifications, and receipts are also assessed based on related documents. If the actual party responsible for overloading is found to be the consignor or the transport operator, fines can be imposed on them immediately.
Until now, fines for overloaded vehicles were often imposed on the driver of the violating vehicle, rather than on the consignor who falsified the weight or ordered overloading, or the transport operator. Although there was a separate actual responsible party, drivers were reluctant to report overloading for fear of losing freight assignments.
Starting this month, to clearly distinguish the actual responsible party, procedures to check related documents are mandatory from the crackdown stage on overloading. The scope of related documents was expanded from two types to five. Going forward, not only the cargo consignment certificate but also the bill of lading, cargo specifications, and receipt can determine who is responsible for overloading.