LH "Deficit of 100 Million Won per Rental Housing Unit... Government Financial Support Must Increase"

Public Rental Housing Forum at the National Assembly
Director Jeong Chang-mu: "110 Million KRW Deficit per Construction"
Assemblyman Min Hong-chul: "Government Support Rates Must Be Realistic"

The Korea Land and Housing Corporation (LH) has called for increased government support for public rental housing. LH revealed that it incurs a deficit of 110 million KRW for each rental housing unit constructed.

Korea Land and Housing Corporation (LH) Seoul Regional Headquarters, Gangnam-gu, Seoul. Photo by Yonhap News

On the 4th, LH held a policy forum at the National Assembly titled 'Exploring Measures to Expand Government Support for Public Rental Housing.' At the forum, Jeong Chang-mu, President of the Korea Research Institute for Human Settlements, stated, "The government's support standard amount for 2023 is 191 million KRW per unit, but the actual project cost is 302 million KRW per unit," adding, "This results in a deficit of about 110 million KRW for each unit constructed." He also said, "Because the government support unit price has not been adjusted to reflect reality, the burden on public rental housing operators such as LH is increasing, which is causing the accumulation of debt," and urged, "To ensure the sustainability of public rental housing projects, it is now necessary to expand government financial support."

Min Hong-chul, a member of the Democratic Party of Korea who co-hosted the forum, mentioned, "The government support unit price should be adjusted to reality so that public housing operators can smoothly carry out projects without excessive financial burdens." He also added, "I propose establishing a Housing Agency under the Prime Minister's Office."

As land and construction costs rise, the government support rate for construction-type public rental housing has been decreasing year by year.