[Why&Next] Up to 39,000 Households in 1st Phase New Town Leading District... Proposal to Lift Greenbelt Restrictions

Ministry of Land Announces '1st Phase New Town Leading District Selection Plan'
Favorable for Integrated Reconstruction Promotion and Higher Resident Consent Rates
Seongnam City "GB Must Be Released"... Ministry of Land "One Team with Local Governments"

The government will designate up to 39,000 households (26,000 households + α) in the first-generation new towns (Bundang, Ilsan, Pyeongchon, Sanbon, Jungdong) this year as pilot zones for the redevelopment of aging planned cities. Multiple complexes must come together to pursue integrated reconstruction and achieve a high resident consent rate to be selected as a pilot zone.

Local governments expressed concerns that the large-scale relocation in the pilot zones, which could begin as early as 2027, might cause turmoil in the jeonse (long-term lease) market. They stated that to accommodate jeonse demand, the government should ease restrictions on development-restricted areas (Greenbelt, GB). In response, the government said it would cooperate as a 'one team' with local government heads.

Resident Consent Rate is Key...Crackdown on Splitting Commercial Spaces and Stalling

Apartment complex in Bundang-gu, Seongnam-si, Gyeonggi Province / Photo by Yonhap News

On the 22nd, the Ministry of Land, Infrastructure and Transport (MOLIT) announced the 'First-Generation New Town Pilot Zone Selection Plan' at the Government Seoul Office. By new town, 8,000 households in Bundang, 6,000 in Ilsan, and 4,000 each in Pyeongchon, Jungdong, and Sanbon will be selected, and depending on conditions, each local government may designate 1 to 2 additional zones (within 50% of the standard volume). In this case, up to approximately 39,000 households will be selected as pilot zones.

The selection criteria are based on the 'standard evaluation criteria' presented by MOLIT, with local governments able to adjust detailed scoring standards. MOLIT explained that since the pilot zone applications will be conducted before the basic plan is established, the evaluation criteria were prepared quantitatively.

The most important evaluation criterion is 'resident consent,' which accounts for 60 points. Currently, some complexes in the first-generation new towns are known to have reconstruction consent rates exceeding 80%. However, this is a self-survey without legal effect, so each complex must obtain consent forms according to a separate format after the application next month. Besides this, MOLIT evaluates urgency for residential environment improvement such as parking spaces per household within the integrated zone (10 points), necessity for urban function revitalization (10 points, qualitative evaluation possible), and ripple effects of redevelopment projects (20 points) to select pilot zones.

An MOLIT official said, "If the Korea Land and Housing Corporation (LH) participates in the implementation or commercial space consent forms are obtained, complexes can receive additional points (up to 5 points) to increase the feasibility of reconstruction." He added, "Splitting commercial spaces will be prohibited by amending the Urban and Residential Environment Improvement Act, and if relocation is deliberately delayed through stalling, a standard charter including claims for damages will be created to ensure smooth project progress."

Jeonse Market Instability During Relocation...On Calls to Lift GB, 'Sequential Redevelopment'

Minister of Land, Infrastructure and Transport Park Sang-woo is announcing the plan to select the leading districts of the 1st generation new towns (Bundang, Ilsan, Pyeongchon, Sanbon, Jungdong) at the Government Seoul Office in Jongno-gu, Seoul on the 22nd. The briefing was attended by the 1st Deputy Governor of Gyeonggi Province, the mayors of Goyang, Seongnam, Anyang, the vice mayor of Bucheon, the mayor of Gunpo, and the president of Korea Land and Housing Corporation (LH). / Photo by Jo Yong-jun jun21@

MOLIT aims for the first pilot zone complexes to start construction in 2027 and move-in by 2030. Local government heads expressed concerns that simultaneous relocation in pilot zones could destabilize the jeonse market. They also emphasized that MOLIT should consider the different supply conditions and characteristics by region. In particular, Seongnam City repeatedly stressed the lifting of GB restrictions. Ilsan, where the 3rd-generation new town Changneung is under development nearby, is less worrisome, but Bundang, with its high urban density, faces difficulties securing jeonse supply.

Seongnam Mayor Shin Sang-jin said, "While relocation measures can be established by basic local governments, it is difficult to realize because Seongnam and Bundang are very densely populated," adding, "All available land is tied up in GB, so local governments have limited options." He continued, "Ultimately, MOLIT must lift GB restrictions and pay attention to new housing supply including Gwangju and Yongin. Otherwise, the redevelopment projects in first-generation new towns could face obstacles."

Anyang City also voiced support. Mayor Choi Dae-ho of Anyang said, "The special law stipulates that local governments lead relocation measures for landowners and tenants, and the government supports this, but there is some contradiction," asserting, "As a local government head, the roles and authority I can exercise are limited."

MOLIT responded that it will strive to stabilize the jeonse market by managing redevelopment demand so that it does not occur all at once. Minister Park Sang-woo said, "If market instability occurs, we will manage annual redevelopment volumes and permit volumes, disperse relocation timing, and prepare stabilization measures for the jeonse market by region," adding, "Relocation measures will be included in the basic plan for each new town, and residents' opinions will be sufficiently reflected to establish relocation measures that meet resident demand."

He further explained using the example of Gwacheon reconstruction, "Looking at redevelopment in Gwacheon over the past 10 years, when one complex is completed, the next follows. The completed volume increases sequentially, and more than half of that is released as jeonse supply, which later acts as supply for relocation measures." He also said that both the government and local governments have urban redevelopment experience, so there should be no difficulty in management.

Gunpo City expects that Sanbon, mixed with the old town, will have different development directions compared to other new towns. Gunpo Mayor Ha Eun-ho said, "There are cases where permanent rental apartments and general apartments exist within the same lot," adding, "The old town can also be developed under the special law, serving as a model case, and there should be no problems with relocation."

Goyang City and Bucheon City also viewed that relocation would not be problematic as land development is underway nearby.

Minister Park said, "Redevelopment of aging planned cities contributes to resident convenience, regional environment improvement, and job creation," and added, "We will do our best to rebirth these areas as premium cities that the public desires."