Seoul Says 90% of Housing Supply is Private, Proposes Deregulation to Presidential Office

The Seoul Metropolitan Government has proposed regulatory relief to the government, including easing relocation loan restrictions and raising the floor area ratio, to revitalize private urban redevelopment projects.

Seoul city officials announced that Mayor Oh Se-hoon delivered a "redevelopment project report" containing these measures to Presidential Chief of Policy Kim Yong-beom on the 5th.

The city explained that this report was prepared following a remark by the president during a Cabinet meeting last month, in which the president asked for a status report explaining why there is a general perception that housing supply is severely lacking.

Seoul stated that 90 percent of the housing supply in the capital over the past three years came from private projects, adding that securing sufficient supply is difficult without revitalizing private redevelopment initiatives.

Citing an analysis of 59 redevelopment and reconstruction sites completed over the past three years, the city explained that these projects resulted in a 36 percent increase in supply, adding about 20,000 homes compared to the previous number of households.

The city urged the government to ease relevant regulations, claiming that breaking ground on 310,000 homes through private redevelopment projects by 2031 would yield a net supply increase of about 87,000 homes.

To achieve this, the city first urged raising the loan-to-value (LTV) ratio for relocation loans from the current 40 percent to 70 percent.

Seoul suggested that relocation loans should be viewed as essential project costs for housing supply rather than household loans, and thus should be subject to different standards than general mortgage loans.

The city also proposed temporarily suspending restrictions on the transfer of cooperative member status within overheated speculative districts for three years, and lowering the required consent rate for establishing redevelopment cooperatives from the current 75 percent to 70 percent.

Additionally, the report outlined plans to ease mandatory ratios for rental housing in redevelopment projects while increasing the floor area ratio for private redevelopment up to 1.2 times the legal limit to secure the required number of rental units.

(Photo provided by the Presidential Photo Press Corps, Yonhap News)
※ Please note: This article was translated by AI and may contain errors.