Assemblyman Kim Hoe-jae, Chief Sponsor of the Special Act on Public Housing

Comprehensive Overhaul of Public Rental Apartment Sale Conversion System

Revaluation Frequency Expanded to 3 Times, Cost Burden on Responsible Party

New Penalties Established for False Appraisals

[Asia Economy Honam Reporting Headquarters, Reporter Heo Seon-sik] A bill to completely reform the sale conversion system of public rental apartments has been proposed.

On the 8th, Kim Hoe-jae, a member of the Democratic Party of Korea (Yeosu-eul, Jeonnam), announced that he has jointly proposed two partial amendments to the 「Special Act on Public Housing」 aimed at improving the method of calculating the sale conversion price and strengthening penalties for false appraisals.

Rep. Kim explained the reason for the proposal, saying, “We must not neglect the suffering of citizens who trusted the state and moved into public rental housing,” and “We need to institutionally prevent maliciously high sale prices that evict residents living in 10-year public rental housing.”

The 「Special Act on Public Housing」, jointly proposed by Rep. Kim, expands the number of times the sale conversion price can be re-evaluated from the current one time to three times if the related laws are violated, and requires the party at fault to bear the costs.

Under the current law, even if an appraisal firm violates laws during the appraisal, only one objection can be filed, and if the appraisal is incorrect, the objector must bear the cost, which has been criticized as irrational.

Additionally, the responsibility of appraisers evaluating the sale conversion price of public rental housing has been strengthened.

First, a provision equating appraisers to public officials has been newly established to punish illegal acts such as bribery when appraising the sale conversion price of public rental housing. Accordingly, if an appraiser receives bribes from construction companies or others and commits fraudulent acts, they will be sentenced to imprisonment for more than one year.

Rep. Kim said, “The calculation of the sale conversion price of public rental housing is a public duty entrusted by the state,” and “The provision equating appraisers to public officials was introduced to ensure fairness and accountability in performing their duties.”

Rep. Kim also announced the establishment of penalty provisions imposing imprisonment of up to five years or fines of up to 50 million won for false or incorrect appraisals made by violating laws or through improper methods.

Furthermore, the 「Special Act on Public Housing」 proposed by Rep. Kim specifies in the law that the sale conversion price shall be calculated as the arithmetic average of the construction cost and the appraisal amount.

Before the sale conversion, a safety inspection must be requested from a safety inspection agency to conduct a safety diagnosis of the housing, and any uncorrected defects must be reflected in the calculation of the sale conversion price.

Moreover, if there are serious defects, the sale conversion will only proceed after the defects have been repaired, thereby protecting the tenant’s housing rights and property rights.

Rep. Kim Hoe-jae said, “The amendment bill was prepared so that the revised regulations can also apply to about 268,000 units of 10-year public rental housing, both public and private, that have not yet been converted to sale,” and added, “I will do my best to ensure the law passes to protect citizens’ opportunities to own homes and housing stability.”

Asia Economy Honam Reporting Headquarters, Reporter Heo Seon-sik hss79@asiae.co.kr