Regional Housing Cooperatives Hiding Information from Members Will Not Be Allowed to Designate Zones

Decision After Information Disclosure Check Before Designation of District Unit Plan Area
114 Out of 118 Land and Housing Sites Eligible for Designation
District Designation Not Possible if Legal Obligations Are Not Fulfilled

# The A Regional Housing Association, which recruited members in 2016, has not received approval for the establishment of the association as of 2024. Mr. B, who joined as a member in 2021, has been unable to access information such as the member list and fund usage details for nearly three years. Although he believed the project would proceed quickly after seeing the submission of the district unit plan proposal, the reality was different.

Regional housing associations that do not share information that must be disclosed to members, such as member recruitment status, audit reports, and member contribution payment details, find it difficult to advance their projects.

This measure is to prevent cases where members of regional housing associations suffer damages due to their lack of knowledge about project progress.

On the 2nd, the Seoul Metropolitan Government announced that it will first inspect information disclosure and other requirements stipulated by the Housing Act before deciding whether to designate a district unit planning zone for regional housing associations.

If the project area is 5,000㎡ or larger, or if more than 100 apartment units are to be constructed, the area must be designated as a district unit planning zone. Currently, 114 out of 118 regional housing associations (97%) pursuing projects within Seoul are subject to designation.

The city has decided that if regional housing associations fail to fulfill their legal obligations after an information disclosure inspection, it will not allow the designation of the 'district unit planning zone,' which is a step prior to approval of the association's establishment.

Generally, regional housing associations follow the procedures of member recruitment notification → district unit planning zone designation → approval of association establishment → project plan approval → groundbreaking → completion → association liquidation. The designation of the district unit planning zone is decided and announced through resident-initiated proposals, resident review and public notice, and deliberation by the city’s Urban Architecture Joint Committee.

The city plans to thoroughly verify compliance with information disclosure and other obligations because there have been complaints and damages caused by recruiting members during the 'district unit planning zone designation and plan establishment' stage, which is prior to approval of association establishment, by giving the impression that the project would proceed quickly but failing to properly advance it.

Going forward, the city will strictly check for violations of the Housing Act during each administrative procedure stage and will not proceed with administrative procedures related to district unit planning zone designation and plan establishment if corrective actions are not taken.

During the preliminary review of the district unit plan, proposal submission, resident review and public notice, and other procedures for designating the district unit planning zone, the city will verify whether issues pointed out in the 'Seoul Regional Housing Association Status Survey' have been addressed. It will also examine whether information such as member recruitment status, audit reports, and member contribution payment details are being fully disclosed.

Additionally, the city will focus on verifying whether annual fund operation plans and execution performance reports have been submitted to the relevant district office, and whether legal obligations such as audits and dissolution general meetings have been fulfilled.

As a result of a joint expert status survey conducted by the city from August to October last year on 111 regional housing association project sites in Seoul, a total of 396 cases were detected in 82 associations, and administrative guidance and other corrective measures were requested.

Han Byung-yong, Director of the Seoul Housing Policy Office, said, "We will implement systematic and thorough management of regional housing associations to further strengthen the public role. Through rigorous status surveys and periodic inspections, we will protect members and establish a transparent and fair regional housing association system."