Second Real Estate Pledge Announcement, Focus on Expanding Supply
[Asia Economy Reporter Park Jun-yi] Won Hee-ryong, former governor of Jeju Province and a presidential candidate from the People Power Party, has pledged to abolish the Moon Jae-in administration's safety inspection standards and reconstruction periods to expand housing supply. The goal is to increase the housing supply by removing regulations related to safety inspections.
On the 17th, Won held a press conference at the National Assembly, stating, "Under the Moon administration, even if walls crack or rust appears, reconstruction is not allowed," explaining, "This is because the safety inspection standards were changed to make reconstruction difficult. Since the standards were changed, the failure rate of safety inspections has increased sixteenfold."
He continued, "We must not forget that the original purpose of reconstruction safety inspections is safety management, not regulation," adding, "In Japan, the decision on whether to reconstruct is entirely made by the housing association. Standards like safety inspections have long been abolished for over 20 years."
He argued that abolishing the safety inspection standards would increase housing supply. He said, "Short-term price increases due to allowing reconstruction are expected, but in the mid to long term, prices will stabilize as supply continuously increases. If the excessively strict safety inspection standards set by the Moon administration are abolished, at least 300,000 housing units can be supplied in the metropolitan area."
He also stated that the reconstruction period, currently set at a minimum of 30 years, should be abolished. Won emphasized, "If owners agree to reconstruct for more comfortable and convenient housing, the government has no right to block it if there is no risk of the apartment collapsing."
Won pledged to abolish the aging criteria and allow reconstruction and redevelopment to proceed according to regional characteristics. He said, "The aging criteria are the biggest obstacle to redevelopment projects," explaining, "To qualify, more than two-thirds of buildings must be over 30 years old, and the total floor area must meet a 60% threshold. Simply put, if there are a few newly built villas near a shantytown, redevelopment cannot proceed."
He added, "The key to solving the problem is to significantly ease reconstruction and redevelopment regulations and enable housing supply through various methods," emphasizing, "Like in the UK, the central government will provide only minimal guidelines, allowing local governments to autonomously promote projects."
To this end, he said he would establish a governance system in the regions. He stated, "We will build a governance system where the community discusses and decides together what type of development is best for the area," and predicted, "This will enable various developments tailored to purposes such as customized development for the silver generation, youth, and newlyweds, or regional win-win development addressing urban infrastructure shortages."
In response to a question from reporters immediately after the press conference about whether loosening regulations could raise housing prices, he explained, "Prices will rise in the short term, but if blocked, the accumulated demand will explode even more severely. We aim to maintain a normal demand-supply balance by continuously supplying an appropriate amount in cooperation with the private sector."
Regarding the question about the 'governance system' preparation plan, he replied, "There are urban innovation and development models worldwide that reflect residents' diverse characteristics, such as urban planning in Japan and redevelopment of poor areas in East London, UK," adding, "Once values and standards are clearly established, the specific practical methods should be concretized together with experts and practitioners."
Previously, Won had announced 'Banban Housing' as his first pledge.
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