Home Pension Subscribers Can Continue Receiving Pensions Even After Moving to Silver Town

Expansion of Eligibility and Benefits for Preferential Housing Pension Enrollment

Starting from the 20th, housing pension subscribers will be able to continue receiving their pension even if they move to a silver town. Additionally, from the 3rd of next month, the eligibility and benefits for the preferential housing pension will be expanded.

The Korea Housing Finance Corporation (HF) announced on the 16th that it will implement these institutional improvements to ensure stable retirement through the activation of the housing pension.

Asia Economy DB

First, from the 20th, housing pension subscribers will be able to move to elderly welfare residential facilities under the Elderly Welfare Act (elderly welfare housing, nursing facilities, elderly communal living homes) while receiving their housing pension, provided they obtain prior approval from HF.

Also, when moving to a silver town, subscribers can find tenants for their existing homes and earn additional rental income. Housing pension subscribers are required to actually reside in the subscribed home, but exceptions to actual residence are recognized only for unavoidable reasons such as hospitalization for medical treatment.

Silver Town Photo by Asia Economy DB

Furthermore, to ease the burden on customers, from the 3rd of next month, the housing price eligibility for the preferential housing pension will be raised from under 200 million KRW to under 250 million KRW. Accordingly, a 76-year-old subscriber (the average age for the preferential type, based on general housing) with a housing price of 220 million KRW will receive a monthly payment of 970,000 KRW, which is 13.7% more than the 853,000 KRW received under the general housing pension.

Along with this, the individual withdrawal limit for the preferential housing pension, which can be used when a lump sum is needed, will be expanded from 45% to 50%. Additionally, if funds are needed to repay senior-ranking mortgage loans on the subscribed housing for the preferential housing pension, the system will be improved to allow the use of up to 90% of the pension loan limit for individual withdrawals.

Moreover, to reduce customer burden, from the 3rd of next month, if a single homeowner with a housing price under 250 million KRW subscribes to the housing pension and there is no internet market price information (from Korea Real Estate Board or KB), the appraisal fee will be covered by the corporation. For example, a homeowner with a 200 million KRW house can save approximately 409,000 KRW in appraisal fees.

Choi Jun-woo, president of HF, stated, "To improve elderly housing welfare and ensure stable retirement income, we have lowered the entry barrier for the preferential housing pension and allowed subscribers to continue receiving the housing pension even if they move to a silver town. We will continue to improve the system so that the housing pension can more reliably support the retirement of many elderly people."