[Beginner's Guide] They Say 'First-Time Special Supply' Is Increasing... How Can You Get It?

[Asia Economy Reporter Lee Chun-hee] When you become a real estate reporter, you occasionally get unexpected KakaoTalk messages from friends. "How do I apply for a housing subscription?" "What is first priority?" For the 2030 'Burin-i (Real Estate + Beginner)' who only have subscription savings accounts created by their parents when they were young, I am trying to create a guide.

It became known that President Moon Jae-in personally called Minister Kim Hyun-mi of the Ministry of Land, Infrastructure and Transport to the Blue House on the 2nd and instructed to "expand the supply of special quotas for first-time homebuyers" as one of the main directions of housing policy. This brought the 'special supply for first-time homebuyers' into the spotlight. While many Burin-i have heard of special supplies for newlyweds or multi-child families, the special supply for first-time homebuyers can be somewhat unfamiliar. Today, we will learn about the special supply for first-time homebuyers.

You cannot apply just because you have never owned a house... Only those who have worked for more than 5 years are eligible

Announcement for Residents Recruitment of Godeok Gangil Complex 8 in Gangdong-gu, Seoul - Eligibility for First-Time Homebuyer Special Supply (Provided by SH Corporation)

The special supply for first-time homebuyers is, as the name suggests, a special supply method available only to those who are purchasing a home for the first time in their life. Among the households built in each complex, a basic 20% and up to 30% can be supplied this way. At this time, the criterion for 'first-time' means that neither the applicant nor any member of the applicant's household has ever owned a home.

However, just because you have never owned a home does not mean everyone can apply for the special supply for first-time homebuyers. If you are single or divorced, you cannot apply unless you have children. According to the current 'Housing Supply Regulations,' eligibility is granted only to those who are married or have children as of the date of the resident recruitment announcement. Also, if only children are present, the children must also be unmarried.

Even if you have a spouse or children, new employees cannot apply for the special supply for first-time homebuyers. Only workers or self-employed individuals who have worked for more than 5 years can apply. This is based on income tax payment records. Of course, even if you did not pay income tax through year-end tax settlement or received a refund, it is recognized as having paid for that year.

There is also an income criterion. For a three-person household, if the monthly income exceeds 5.63 million KRW, you cannot apply. Currently, subscription eligibility is granted only if the household's average monthly income is below the previous year's average monthly income of urban workers' households. For this year, the limits are 2,645,147 KRW for a one-person household, 4,379,809 KRW for two persons, 5,626,897 KRW for three persons, and 6,226,342 KRW for four persons. If the household earns more than these amounts, the special supply for first-time homebuyers is not possible.

Moreover, unlike the special supply for newlyweds, there is no procedure to raise the income criteria when there is spouse income, so meeting the requirements can be even more difficult.

Finally, asset criteria may also apply. For this year, the combined value of real estate assets such as land and buildings must be 215.5 million KRW or less, and if owning a car, its value must be 27.64 million KRW or less.

Limited supply is a constraint... Will it expand beyond public housing to private housing?

▲ Aerial view of Complex 9 in Magok Urban Development Project Area, Gangseo-gu, Seoul (Provided by SH Corporation)

However, even if you overcome all these hurdles and meet all the requirements to apply for the special supply for first-time homebuyers, challenges remain. The special supply for first-time homebuyers is only available for national housing. National housing refers to homes with a floor area of 85㎡ or less (exclusive area) built by the state, local governments, Korea Land & Housing Corporation (LH), or local public corporations, or supported by state or local government finances or the Housing and Urban Fund. Simply put, the special supply for first-time homebuyers is only possible among 'small to medium-sized homes supplied through public sales.'

However, unless there is large-scale land development, most homes are supplied through private sales, so the amount of national housing supplied is quite limited. Even now, the public sale complexes with concrete supply plans in Seoul this year are only two: Songpa-gu Wirye New Town A1-5 Block (1,282 households) and A1-12 Block (394 households).

Moreover, the competition rate is not low. In March, the special supply for first-time homebuyers at Magok 9 Complex in Gangseo-gu attracted 5,652 applicants for 192 households, showing a competition rate of 29.4 to 1. This was the highest competition rate among the special supply types including newlyweds, multi-child families, and elderly parents support.

In the same month, the special supply for first-time homebuyers at Jade Xi in S9 Block, Knowledge Information Town, Gwacheon-si, Gyeonggi Province, showed a competition rate of 34 to 1, and last month, the special supply at Goduk Gangil 8 and 14 Complexes in Gangdong-gu showed competition rates of 22.0 to 1 and 17.6 to 1, respectively.

Therefore, some predict that since President Moon Jae-in directly mentioned the special supply for first-time homebuyers, the quantity supplied through this type will increase significantly. It is expected that the supply, currently at a basic 20%, will be increased to the maximum 30%, and the target will be expanded to private housing where the special supply for first-time homebuyers is currently not applied.