The government decided to directly buy land held by the private and public sectors to secure candidate sites for public housing in the greater Seoul area. Korea Land & Housing Corporation (LH) will begin accepting applications to sell land of 3,300㎡ (about 1,000 pyeong) or more in the greater Seoul area at the end of this month. Since the related law was enacted in 2009, this is the first time "land for supply-demand adjustment" will be purchased through an open buyback.
According to the construction industry on the 2nd, LH will accept applications to sell public stockpiled land for supply-demand adjustment from the 29th to Oct. 28. The government plans to pre-secure small and mid-sized land that can be used in the greater Seoul area, then use it for public housing construction after a feasibility review.
Land for supply-demand adjustment is land that LH pre-secures to stabilize the land market under the Act on the Stockpiling of Public Land. The law classifies stockpiled land as either for public development or for supply-demand adjustment.
For public development, the method is to purchase needed land in advance after public utilities such as roads or industrial complexes are finalized. By contrast, for supply-demand adjustment, land can be secured even without a specific project being finalized, taking into account future usability and land market conditions.
Since the law was enacted, LH has purchased land for public development but has never actually purchased land for supply-demand adjustment. In March, the government convened the Public Land Stockpiling Deliberation Committee and for the first time approved the purchase of land for supply-demand adjustment.
Eligible sellers include the state, local governments, and land of 3,300㎡ or more in Seoul, Gyeonggi, and Incheon registered under individual or corporate names. LH will select purchase targets by evaluating regional supply-demand conditions such as population and land price growth rates, as well as zoning, location, and the potential for public housing projects.
Applications can be made on the LH website. The LH Seoul Regional Headquarters, Incheon Regional Headquarters, Gyeonggi Southern Regional Headquarters, and Gyeonggi Northern Regional Headquarters also accept applications by mail and in person.
The purchase price will be determined in consultation with the landowner based on the arithmetic average of the appraised values from two appraisal firms selected by LH. LH plans to select purchase targets within the year and to begin signing contracts from Feb. next year.
The reason the government activated, for the first time, the system for purchasing land for supply-demand adjustment that it had not used for 17 years is that it has become harder to find additional large-scale public housing sites in the greater Seoul area.
In the plan released on Jan. 29 to expand and expedite housing supply in urban areas, the government said it would supply about 12,600 dwellings in the Yongsan area, including Yongsan International Business District and Camp Kim. About 9,800 dwellings are planned on the sites of Gwacheon Racecourse Park and the Defense Counterintelligence Command, and about 6,800 dwellings on the site of Taereung Golf Course in Nowon District, Seoul.
However, it is difficult to find a site to relocate existing facilities at Gwacheon Racecourse Park, and in Yongsan and Taereung, local governments and residents continue to push back. As plans relying on large-scale public land have struggled to gain speed, the government has even turned to buying individual land.
Yoo Seon-jong, a professor in the Department of Real Estate at Konkuk University, said, "It means the government intends to mobilize every tool available to secure public housing sites," adding, "But if land with varying locations and shapes is purchased rashly, the expense for building infrastructure and construction could rise."
Seo Jin-hyung, a professor in the Department of Real Estate Law at Kwangwoon University, said, "Because this is land secured with public funds, it would be worth considering using it to stabilize housing for vulnerable groups, such as through long-term public rental housing, rather than for for-sale dwellings."