"Lots of Money but No Land... Controlling Seoul Housing Prices with Gold City and Revitalizing Provinces"

2nd Anniversary Press Conference of Kim Heon-dong, President of SH Corporation

"There is plenty of funding, but no more land to develop. We will build Gold City outside of Seoul to control housing prices and solve the problem of population decline in local areas."

On the 15th, Kim Heon-dong, president of Seoul Housing and Communities Corporation (SH Corporation), held a press conference in Jung-gu, Seoul, marking his second anniversary in office, and made this announcement. Gold City is a Seoul-local win-win circular housing project that builds premium housing with jobs and residences within new towns for Seoul citizens such as young and middle-aged people and retirees who wish to relocate to local areas, while the public sector purchases or rents existing houses to re-supply couples urgently needing solutions for commuting issues.

In an interview with Asia Economy last month, President Kim said, "There is no need for children to exhaust themselves commuting from Gyeonggi Province, or for the older generation to wander around Tapgol Park in Jongno 3-ga," emphasizing, "Gold City is a nationally necessary policy for the circulation of the younger and retired generations."

Kim Heon-dong, President of SH Seoul Housing and Communities Corporation. Photo by Heo Young-han younghan@

The initial funding for Gold City has already been poured in. On the 8th, Seoul City and SH Corporation signed a memorandum of understanding with Gangwon Province, Samcheok City, and Gangwon Development Corporation to promote Gold City. Through this, five cooperating institutions plan to officially start the Gold City pilot project. President Kim said, "Besides Samcheok, we are also keeping an eye on Chuncheon and Yangyang."

Furthermore, President Kim plans to develop Gold Town, an expanded concept of Gold City in the metropolitan area. He particularly emphasized applying this to the recently expressed development intentions for the 3rd New Town, aiming to completely differentiate it from the new towns built so far by Korea Land and Housing Corporation (LH).

President Kim said, "The previous government announced plans to develop 13 sites for the 3rd New Town, but compensation has only been made for six sites, and seven sites have not even started," adding, "We intend to develop the lands that LH has designated but left idle." It is known that SH is also reviewing the development of Gold Towns in the suburbs of Seoul, such as Gwacheon and Hanam, in addition to the 3rd New Town.

SH Corporation is a public enterprise under Seoul City. Regarding the background of SH's plan to carry out development projects outside Seoul, President Kim said, "The government entrusted LH with development in Gangnam Suseo-Jagok, Seocho Umyeon, and Nowon Taereung, so SH has no land to develop," adding, "Therefore, we plan to supply high-quality apartments built on a post-sale and cost-disclosure basis outside Seoul."

President Kim emphasized that SH Corporation's assets are at the level of 100 trillion won, indicating sufficient financial capacity for development. He said, "SH owns 100,000 apartments in Seoul alone, worth about 85 trillion won at market prices," adding, "Including land value, the assets amount to 100 trillion won." He further stated, "There is no problem securing funds for Gold Town and Gold Series."

Kim Heon-dong, President of SH Seoul Housing and Communities Corporation. Photo by Heo Young-han younghan@

Meanwhile, President Kim also announced a policy to minimize SH Corporation's lease agreements based on purchase commitments. Purchase commitments involve pre-contracting to buy private newly built houses and purchasing them once completed. President Kim said, "When housing prices soared, purchase commitments allowed buyers and builders to take all the price increases," adding, "SH can supply good apartments at affordable prices if it builds them, so why buy multi-family villas at high prices?"