SH Corporation "Post-sale Expansion Needed... Improvement Required in Pricing Calculation System"

Strengthening Buyer Choice and Increasing Price Transparency
"Post-sale Public Housing Prices Should Be Decided by Local Government Heads"

Seoul Housing and Communities Corporation (SH Corporation) emphasized on the 17th that the pricing system for pre-sale housing should be reformed to promote the expansion of post-sale housing, which strengthens the choice rights of buyers.

In a press release on the same day, SH Corporation stated, “The post-sale system allows buyers to apply after directly inspecting the apartment, providing accurate information and choice rights to buyers,” and added, “To activate this, the government should establish a pricing system for post-sale housing.”

Post-sale refers to a system where housing is sold after the construction process is nearly complete, and the sale price is calculated based on the actual construction costs incurred. In contrast, pre-sale requires buyers to decide on applications based on perspective drawings or model houses provided by the supplier before the house is built, and the pricing is calculated using estimated costs rather than actual construction costs, which has been criticized for lacking transparency and reliability.

To address the problems arising from pre-sale, SH Corporation has been implementing a post-sale system that discloses the construction cost and selects residents when the construction progress reaches 90%. This aims to reduce risks such as construction suspension due to poor workmanship or sudden increases in material costs.

Along with this, SH Corporation proposed that in the case of public sale housing where construction costs are transparently disclosed, the head of the local government should be able to determine the sale price. Currently, the price is calculated based on related systems such as the “standard construction cost” set by the government, which has been analyzed as a factor hindering the improvement of quality and performance of public housing.

Kim Heon-dong, President of SH Corporation, said, “Post-sale and disclosure of construction costs are policy directions to supply high-quality and high-performance housing to Seoul citizens,” and added, “We will continuously request improvements to related systems to realize buildings that can be used for over 100 years.”