Professor Jin Mi-yoon of Myongji University Graduate School of Real Estate warned on July 23 that housing supply bottlenecks are intensifying due to permit and construction start contractions. Speaking at a real estate policy public debate held at KBS Annex in Yeouido, Seoul, Jin stated that simultaneous declines in permits and construction starts since 2022 will lead to reduced completion and move-in volumes, ultimately increasing housing cost burdens for low and middle-income households. The professor emphasized that the most concerning issue is not temporary supply reduction but the breaking of housing supply linkages.
Housing Supply Pipeline Disruption Since 2022
Jin explained that permits and construction starts have declined simultaneously since 2022, which will result in reduced completion and move-in volumes in the future and decreased inventory in the existing transaction market. "This will ultimately lead to increased housing cost burdens for low and middle-income households," Jin stated.
The professor highlighted that non-apartment construction has significantly decreased after tenant confidence collapsed following jeonse fraud incidents. "Non-apartments are an important housing option for young single-person households and newlyweds, accessible with smaller deposits and monthly rents compared to apartments, but the decrease in non-apartments is causing difficulties in housing choices," Jin said.
Jin Recommends Financial Support and Deregulation Measures
Jin stated that what is needed now is restoring the housing supply pipeline so that permits lead to construction starts, and construction starts lead to completions and move-ins. The professor called for expanded financial and tax support to back new construction supply, along with regulatory easing to activate private redevelopment.
"We must improve the environment where permits, land acquisition, and construction starts are not connecting, and prioritize support for volumes that can proceed to construction," Jin explained. "We need to continuously manage bottlenecks at all stages, including construction cost burdens and conflicts between associations."
Jin added that monitoring is necessary to verify whether regulatory easing measures such as floor area ratio increases are actually leading to supply. The professor also stated that an implementation system should be established for sufficient supply to proceed with momentum, while providing various supply types for move-in conversions and actual users.
Jin noted that as the need to utilize idle and aging buildings and sites in urban centers grows, regulatory easing is necessary. However, the professor emphasized that selective deregulation is more important than uniform easing, as excessive deregulation raises concerns about haphazard development.
The professor also stated that professional rental entities capable of new construction and long-term operation should be fostered, but public accountability and tenant protection obligations corresponding to support levels should be imposed. Jin added that the public sector's role should expand from rental supply to market creator supporting affordable housing.
Regulatory Area Designation Review Called For
Jin stated, "The effectiveness of regulated areas such as adjustment target areas, speculation overheating zones, and land transaction permit zones should be re-examined, and timely lifting should occur according to objective criteria."
FAQ
What did Professor Jin Mi-yoon warn about on July 23?
Professor Jin Mi-yoon of Myongji University warned at a real estate policy public debate on July 23 that housing supply bottlenecks are intensifying due to permit and construction start contractions, with simultaneous declines since 2022 expected to lead to reduced completions and increased housing cost burdens for low and middle-income households.
Why has non-apartment construction decreased according to Jin?
Jin stated that non-apartment construction has significantly decreased after tenant confidence collapsed following jeonse fraud incidents, creating difficulties for young single-person households and newlyweds who rely on non-apartments as accessible housing options with smaller deposits and monthly rents compared to apartments.
What policy measures did Jin recommend to address supply bottlenecks?
Jin recommended expanded financial and tax support for new construction supply, regulatory easing to activate private redevelopment, selective deregulation of idle and aging urban properties, and re-examination of regulated area designations with timely lifting based on objective criteria.
