To support funding for small and medium-sized local housing developers, six regional banks, along with the Housing and Urban Guarantee Corporation (HUG) and the Korea Housing Finance Corporation (HF), are working to establish a financial and guarantee linkage system. They plan to develop tailored guarantee products and review financial support measures for local housing developers.
On October 8, the Korea Housing Construction Association announced that it signed a memorandum of understanding at the headquarters of Kyungnam Bank with six regional banks, including Jeonbuk Bank, Gwangju Bank, Jeju Bank, iM Bank, and Busan Bank, as well as HUG and HF, to revitalize the local housing construction industry.
Under the agreement, regional banks will support funding for small and medium-sized local housing developers. HUG and HF will explore guarantee support linked with regional banks and develop public guarantee products that reflect the characteristics of the local housing market. The housing construction association will encourage its members to engage with local banks and deposit funds while identifying viable local projects.
According to housing statistics from the Ministry of Land, Infrastructure and Transport, as of August, there were 49,998 unsold homes in non-capital areas, a 2.5% increase from the previous month. This means that 72.3% of the 69,134 unsold homes nationwide are concentrated in these regions. Housing permits in non-capital areas decreased by 15.8% year-on-year, totaling 67,879 units from January to August this year.
The association aims to establish a financial structure that channels locally raised funds into housing projects in the region. It also seeks to jointly explore financial and guarantee support measures to ensure housing stability and settlement for future generations.
Kim Sung-eun, president of the Korea Housing Construction Association, stated, “This will provide a foundation for more flexible financial support and tailored guarantees for small and medium-sized housing developers facing funding difficulties. We will work to build a financial and guarantee safety net.”
* This article has been translated by AI.
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