New Housing Subscription Transfers to Korea Appraisal Board, New Applications Halted for January
Legal Amendments Needed but Delayed Due to Parliamentary Deadlock... Prolonged Service Gaps Possible
[Asia Economy Reporter Lee Chun-hee] Due to political conflicts and the government's irresponsible transfer of duties, concerns are rising over disruptions to apartment subscription schedules for housing companies from the beginning of the year. The transfer of housing subscription tasks between the Korea Financial Telecommunications & Clearings Institute (KFTC) and the Korea Real Estate Board (KREB) has caused a complete halt in new subscriptions throughout January. Meanwhile, the National Assembly, which must process related legislation, is repeatedly deadlocked, raising the possibility of a prolonged work gap.
According to industry sources on the 2nd, the KFTC, which had been handling private housing subscription tasks through the 'Apartmenttoyou' website, stopped accepting new resident recruitment announcements at the end of December last year and plans to end the remaining tasks such as subscription, inquiry, and eligibility verification by the end of this month. This is a measure following the government's decision to transfer housing subscription duties from the KFTC to the KREB starting next month. Accordingly, the 'Paragon Central Park' in the Geomdan district of Incheon, which issued a resident recruitment announcement last year and will receive subscriptions from the 7th to the 9th of this month, is expected to be the last complex to proceed with subscription schedules through Apartmenttoyou.
The transfer of subscription duties was implemented to strengthen pre-verification of subscription eligibility. In the Apartmenttoyou system, subscribers directly input their subscription qualifications, ranking, and points, so if information is mistakenly entered, they must endure disadvantages such as subscription restrictions. The Ministry of Land, Infrastructure and Transport plans to strengthen the pre-verification process in the new system, allowing a one-time inquiry of related information such as the subscriber's and household members' housing ownership status, official housing price viewing, and calculation of the non-homeownership period.
However, there is also a possibility that the subscription gap could be prolonged. From next month, the KREB is supposed to receive resident recruitment announcement applications from companies and handle subscription tasks, but there is no legal basis as the related legislation has not been amended. For the KREB, a non-financial institution, to operate the new subscription system and process financial information of subscription account holders, an amendment to the Housing Act is necessary.
▲ As of the 2nd, the Housing Act amendment bill has still not been submitted to the Legislation and Judiciary Committee (Provided by the National Assembly Legislative Information System)
The bill was already introduced in May last year by Representative Ham Jin-gyu of the Liberty Korea Party. Subsequently, on the 6th of last month, the bill passed the full meeting of the Land, Infrastructure and Transport Committee in the form of a committee alternative, but due to the confrontation between ruling and opposition parties over amendments to the Public Official Election Act and the High-ranking Officials' Crime Investigation Act (the Corruption Investigation Office Act), it has yet to be even submitted to the Legislation and Judiciary Committee. Currently, it is impossible to estimate how long it will take to pass through the Legislation and Judiciary Committee and be approved by the plenary session. Even if the bill passes, considering that it takes at least two weeks or more for government transmission and promulgation, it is uncertain whether the amendment can be implemented within January.
If the absence of the subscription system due to the work gap prolongs, significant confusion is expected in the market. According to the industry, 119 apartment complexes with 84,400 households are scheduled to be supplied nationwide over the two months of February and March. Especially in most areas of Seoul where the private land price ceiling system applies, as well as in Gwacheon, Hanam, and Gwangmyeong, subscriptions must be conducted within the grace period scheduled until the end of April to avoid these regulations. However, if the subscription work gap prolongs, it could cause major setbacks to projects.
Some suggest that the Ministry of Land, Infrastructure and Transport might postpone the transfer of duties again through a revised notification, but it is uncertain whether the KFTC, which has already announced it will stop all related tasks by the end of this month, will accept this.
An industry official pointed out, "In large-scale housing projects, even a one-month delay can incur considerable financial costs," adding, "This subscription work gap is a typical result of desk-bound administration."
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