Public housing projects in regional areas are increasingly relaxing contract terms and application qualifications to attract residents. These measures include lowering deposits, offering five-year interest-free installments, providing incentives to real estate agents, and opening applications to homeowners and corporations. Some projects have been seeking additional residents for four consecutive years since their initial supply.
According to the Korea Land and Housing Corporation (LH) on September 30, the Ulsan Daun 2 A-9 Block newlywed hope town is conducting a first-come, first-served contract for remaining units with a five-year interest-free installment plan and free balcony extension. The contract period runs until the end of December.
This project has continued to seek additional residents since it first recruited occupants in August 2022, with multiple recruitment announcements made this year, including a recent release of the remaining unit list on September 17.
The Cheongju Jibuk B1 Block in North Chungcheong Province is also offering incentives to real estate agents. LH reduced the deposit from 15% of the housing price to a flat rate of 10 million won in July. Starting August 31, real estate agents who secure contracts will receive 2 million won per household. As of August 24, there were 576 remaining units, including 227 units of 55 square meters and 349 units of 59 square meters.
A local real estate agent in Cheongju stated, “Even with the lowered deposit and incentives for agents, the fundamental issue remains. Actual buyers are ultimately influenced by surrounding market prices, location, and the potential for price increases, so easing conditions does not lead to the depletion of inventory.”
Recent projects have also seen qualification relaxations. On September 28, LH announced an additional recruitment for 182 units in the Wonju Musil A-2 Block public housing, following the initial recruitment in September last year and an additional recruitment in April this year.
The requirements regarding homeownership status, residence area, subscription savings accounts, income and assets, and past winning records have been eliminated. Homeowners and corporations can apply, and multiple applications from one household are permitted. However, contracts will not be on a first-come, first-served basis; instead, a lottery will be held among applicants.
In Jeonbuk Iksan Peace public housing, which closed recruitment last month, the deposit was also lowered to a flat rate of 5 million won, with 48% of the housing price payable interest-free over five years. No restrictions were placed on residence area, homeownership status, income and assets, subscription savings accounts, or past winning records, and corporate contracts and additional purchases by existing contract holders were allowed.
The long-term unsold status of public housing in regional areas highlights the need to examine housing demand by region. Even with reduced initial financial burdens and lowered application thresholds, remaining inventory persists, indicating that location, surrounding supply, and actual demand in the area must be considered.
Kim Seon-a, head of the Real House Sales Analysis Team, recently commented on the housing market, stating, “It’s not that the demand for subscriptions has disappeared; rather, it is shifting towards a few verified projects, leading to poorer performance for others. If initial sluggishness occurs, it could lead to unsold and unsold burdens, making the timing of sales and pricing critical to the success of the project.”
* This article has been translated by AI.
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