[Practical Finance] During the New Apartment Supply Shortage, Winning a Housing Subscription Is Possible If You Plan to Have Children

Housing Supply Decreases This Year, Newborn Special Supply Volume ↑
Newborn Special Supply 11,000 Units This Year, Up 74.5% YoY

"Increased Chances for Childbirth Newlyweds to Win Housing Lottery"

Newborn Special Supply, Share of Housing Supply Rises from 3.6% to 8.05%

Newlywed couples who have children will have more opportunities to own a home this year. Although the supply of apartments for sale is lower than in previous years, the priority supply ratio for households with newborns has increased.

Apartment supply decreases, but special supply for newlywed couples with children increases

According to real estate information company Real Estate R114 and the Ministry of Land, Infrastructure and Transport on the 8th, the priority supply for households with newborns among the nationwide special supply for newlywed couples this year is 11,047 units. This is a 74.5% increase compared to last year's 6,331 units. In the past five years, this number has not exceeded 10,000 units.

This year, the priority supply in Seoul will be 1,646 units, a 78.1% increase from last year's 924 units. In the provinces, despite a decrease in total supply, special supply increased in Daegu (889 units → 1,051 units) and Chungbuk (1,085 units → 1,157 units). In Gyeongnam (520 units → 1,520 units), Busan (2,372 units → 4,072 units), and Sejong (0 units → 345 units), both supply and special supply increased during the same period.

Despite the overall decrease in supply, special supply has increased. This year, the supply of private apartments will decrease compared to previous years. According to Real Estate R114, 137,237 private apartment units nationwide will be available in the subscription market this year, a 37% decrease from last year's 217,993 units. Especially, except for 2023 (175,862 units), the supply in the past five years has exceeded 200,000 units. In Seoul, except for 2021 (6,787 units), this year’s supply (20,454 units) is the lowest during the same period.

Hwang Hansol, head of the PR Research Team, said, "Although the total supply has decreased, the increase in special supply for newlywed couples who have given birth will lower the competition rate compared to before," adding, "Other special supplies and general supply will relatively decrease, reducing the chances of winning a subscription."

Kwon Youngsun, team leader of the Real Estate Investment Advisory Center at Shinhan Bank, also said, "This is a good opportunity for newlywed couples who have given birth or are planning to give birth," and added, "Considering that it is difficult to immediately decide to 'have a child' just by seeing the priority supply for newlywed couples, this will be a benefit for couples with children."

Special supply for newlywed couples with children increases from 3 to 8 units per 100 units supplied

The special supply for newborns will increase to up to 35% of the special supply for newlywed couples. At the end of last year, the government announced a partial amendment to the 'Housing Supply Rules,' raising the special supply ratio for newlywed couples in private apartment subscriptions from 18% to 23%. Among this special supply, the priority supply ratio for households with children under 2 years old will increase from 20% to 35%.

For example, when 100 units of an apartment are supplied, the special supply for newlywed couples will increase from 18 units to 23 units. Among these, the priority supply for households with newborns will increase from about 3 units (18 units x 20%) to about 8 units (23 units x 35%).

By income criteria, the priority supply ratio for newlywed couples with children whose household income is 100% (120% for dual-income) or less of the previous year's average monthly urban worker income will increase from 15% to 25%. The priority supply ratio for households with income 140% (160% for dual-income) or less will increase from 5% to 10%. Last year, the average monthly urban worker income was 7,198,649 KRW for a 3-person household and 8,248,467 KRW for a 4-person household.

Jung Suho, director of the Housing Fund Division at the Ministry of Land, Infrastructure and Transport, said, "The amendment will be implemented within the first half of this year unless there are objections during the legislative notice period until the 4th of next month," adding, "After the legislative notice period, the bill will proceed through the Prime Minister's Office, the Ministry of Government Legislation, and the Cabinet meeting."