Oh Se-hoon: "We Must Create Public Housing Where People Want to Live"... Kim Heon-dong: "Transparency Through Disclosure of Sale Prices"

Heondong Kim's First Work Report to Mayor Oh

[Image source=Yonhap News]

[Asia Economy Reporter Kim Hyemin] On the 17th, Seoul Mayor Oh Se-hoon visited the Seoul Housing and Communities Corporation (SH Corporation) and ordered improvements in the quality of public housing. Kim Heon-dong, president of SH Corporation, who was the first to report on business affairs, reiterated his intention to supply affordable and high-quality "half-price apartments" by transparently disclosing the cost of sale.

Mayor Oh made these remarks while receiving a business report on major projects for this year at the SH Corporation headquarters in Gangnam-gu, Seoul. He prioritized "stabilizing the housing market" as the top task and chose SH Corporation as the first affiliated agency to visit.

In his opening remarks, Mayor Oh said, "We need to develop various types of public housing models and ensure timely supply for citizens facing housing difficulties such as youth and newlyweds. Due to the current government's repeated failures in real estate policies, supply has decreased and jeonse prices have risen. Stabilizing the housing market for the citizens is now the most urgent task."

He continued, "Even if it costs more, I hope you consider ways to drastically improve the quality of public housing so that it can be supplied as the best housing."

President Kim emphasized that SH Corporation is the first in the nation to disclose the cost of sale to increase transparency and expressed his commitment to supplying "half-price apartments." During a briefing on the disclosure of the cost of sale for the Ogeum district in Songpa-gu and the Hang-dong district in Guro-gu, he said, "The construction cost per pyeong in Ogeum district is about 5.5 million KRW. Considering this cost structure, half-price apartments priced between 300 million and 500 million KRW for buildings only are definitely feasible."

He added, "The Korea Land and Housing Corporation (LH) does not disclose the cost of sale at all, and in the case of the 3rd and 4th pre-sale subscriptions, apartments are sold at nearly twice the subscription price of 400 million KRW that SH offered. In the case of Daejang-dong, apartments we sold were priced at almost twice the amount, allowing private sectors to make enormous profits. Since only the agreements between the Gyeonggi Urban Innovation Corporation and housing developers are disclosed, the cost of sale remains unknown."

[Image source=Yonhap News]

Meanwhile, at the meeting, Mayor Oh referred to the apartment construction site collapse accident that occurred on the 11th in Gwangju Metropolitan City, saying, "It was revealed that construction was pushed forward recklessly without complying with winter construction regulations. Since several construction projects are underway in Seoul as well, please review the manuals and do your best to prevent even a single accident."

In response, President Kim said, "If post-sale is implemented, problems caused by poor quality like the Gwangju I-Park will not occur, and there will be no forced construction during the winter season due to tight schedules."

He mentioned that SH Corporation advanced the sale timing from 80% to 60% construction progress in 2013 but has delayed the sale timing to after 90% progress since last year, emphasizing, "Unlike pre-sale apartments, there is no harm to ordinary citizens."

Kim Heon-dong, president of Seoul Housing and Communities Corporation (SH Corporation), said on the 17th, "If post-sale is implemented, problems caused by poor quality like the Gwangju I-Park will not occur, and there will be no forced construction during the winter season due to tight schedules."

President Kim stated this at a press briefing held before the mayor’s business report at the SH Corporation headquarters in Suseo-dong, Gangnam-gu, saying, "SH was the first in Korea to implement the post-sale system in September 2006, selling apartments only after they were fully built."

He also mentioned SH Corporation’s change in sale timing from advancing it at 80% construction progress to 60% in 2013, and then delaying it to after 90% progress since last year, emphasizing, "Unlike pre-sale apartments, there is no harm to ordinary citizens."