[Real Estate A to Z] To Open or Not? 고민되는 청약통장... Increased Benefits Explained

Recently, the number of people canceling their subscription savings accounts for housing applications has been increasing. As housing prices continue to rise, the benefits of subscription have diminished, and the low interest rates on these accounts compared to market rates are analyzed as the cause. However, experts advise that since the government plans to raise the interest rates on housing subscription savings and strengthen the financial, tax, and subscription benefits for account holders, it is better to maintain the subscription savings account as much as possible to secure a home.

According to the Korea Real Estate Board's Subscription Home as of the end of July, the number of nationwide housing subscription comprehensive savings account holders was 25,837,293. This is a decrease of 44,771 from the end of June (25,882,064). The number of subscription savings account holders peaked at 27,031,911 in June last year and has been declining since July, the following month. The total decrease in subscription savings accounts over 13 months amounts to 1,194,618.

The decline in subscription savings account holders appears to be influenced by rising housing prices. As raw material costs increase, construction costs have risen, and the price ceiling system for apartment sales has been abolished in all regions nationwide except for the Gangnam 3 districts and Yongsan district, causing apartment prices to surge sharply. It has become difficult to find new apartments cheaper than nearby market prices, reducing the advantages of subscription savings accounts. Moreover, the interest rate on subscription savings accounts is only 2.1% per annum, which is significantly lower than the market bank deposit rates (around 4%), contributing to the cancellation of these accounts.

Nevertheless, experts say it is better to maintain the subscription savings account rather than cancel it hastily. This is because the government announced on the 17th that it will significantly enhance the benefits related to subscription savings as a follow-up measure to the 'Second Half Economic Policy Direction.' The plan includes revising laws to provide more subscription benefits to account holders and raising the interest rates on subscription savings.

First, the functions of the subscription savings account will be greatly strengthened. The subscription score is composed of three categories: period of being without a home (2?32 points), number of dependents (5?35 points), and subscription savings account subscription period (1?17 points), with a total of 84 points. Until now, only one spouse's account was recognized when calculating the subscription period score (17 points). However, going forward, half of the spouse's account holding period can be added for up to 3 additional points. For example, if the individual and their spouse each have held subscription savings accounts for 5 years (7 points) and 4 years (6 points) respectively, the individual can add half of the spouse's holding period, 2 years (3 points), for a total of 10 points when applying. If the individual's subscription period score is not perfect, it becomes advantageous for both spouses to hold subscription savings accounts.

In the subscription scoring system, if a tie occurs, the longer-term subscriber will have an advantage in winning the subscription. Currently, winners are selected randomly in case of a tie, but in the future, winners will be determined based on the length of account subscription. Additionally, the recognized payment period for minors' subscription savings accounts will be extended from the current 2 years to 5 years. Previously, only payments made from age 17 were recognized for 2 years, but going forward, payments and amounts from age 14 will be recognized. Joining subscription savings at age 14 will result in a score more than 5 points higher than joining as an adult. The recognized total amount will also increase from 2.4 million KRW to 6 million KRW.

Financial benefits for subscription savings account holders will also increase. When using government housing purchase loans such as the Didimdol loan, preferential interest rates for long-term holders will be expanded from a maximum of 0.2 percentage points to up to 0.5 percentage points. Tax support will also be strengthened. Currently, up to 40% of subscription savings payments are deductible during year-end tax settlement, and the annual payment limit will be raised from 2.4 million KRW to 3 million KRW. This will increase the annual income deduction limit from 960,000 KRW to a maximum of 1.2 million KRW.

Finally, the government plans to raise the interest rate on subscription savings from the current 2.1% to 2.8%, an increase of 0.7 percentage points, within this month. Previously, in November last year, the government raised the subscription savings interest rate by 0.3 percentage points from 1.8%, where it had been fixed for over six years. Considering this increase, the total interest rate hike under the current administration amounts to 1 percentage point. In particular, the Youth Preferential Comprehensive Savings account, which offers a 1.5 percentage point higher preferential interest rate than the general subscription comprehensive savings, will increase from 3.6% to 4.3%, exceeding market deposit rates.

Park Ji-min, head of the Monthly Subscription Research Institute, said, "The benefits of subscription savings accounts have increased, such as higher preferential interest rates on government housing purchase loans," and advised, "Considering potential future policy changes and opportunity costs, it seems advantageous to maintain the subscription savings account within a manageable burden."