Underground railway underground in Seoul, where is the beneficiary area?

- 'Enter and exit' Stepping Stone Loan Regulatory Direction Changes Three Times in 10 Days
- The revision of the stepping-stone loan is likely to apply conditional loan constraints mainly in the metropolitan area
- It is said to be for household debt management, but even the low-income policy? Concerns over Encouraging Loans
- "LH will bear the increase in the sale price of the main subscription" market welcoming atmosphere and feasibility?

■ Broadcast: YTN Radio FM 94.5 (09:00-10:00)
■ Host: Reporter Cho Tae-hyun
■ Air date: October 28, 2024 (Monday)
■ Dialogue: Kim Kyu-jung, real estate expert at Korea Investment & Securities Co., Ltd.

- Termination of subscription bankbook despite interest rate hike ↑ "concerns about reducing the budget for welfare projects such as stepping-stone loans"
- Seoul apartment weekly rise reduced, areas accumulated for sale increased
- Underground all sections of the Seoul Metropolitan Government's ground railway, question mark on budget procurement?

* The text below may differ from the actual broadcast content, so please check the broadcast for more accurate information.
◆ Reporter Cho Tae-hyun (hereinafter referred to as Cho Tae-hyun): A hot issue in a hot area. <Hot place! How about there? > It's time. This week's real estate-related issues will be pointed out with Kim Kyu-jung, a real estate expert at Korea Investment & Securities. Is the commissioner out?

◇ Kim Kyu-jung, real estate expert at Korea Investment & Securities (hereinafter referred to as Kim Kyu-jung): Yes, hello.

◆ Cho Tae-hyun: Should I say that the real estate market was very hot last week? Should I say it's confusing? Confusion was very loud about stepping stone loans. How can we organize the timeline so far?

◇ Kim Kyu-jung: Yes. I will reduce the limit on loans for stepping stones, and I will suspend it again. There were several announcements of reversal within a short period of time, so there was some confusion for those planning loans. There was a backlash in the market on the 14th, starting with the Ministry of Land, Infrastructure and Transport sending an official letter to make limited loans for some of the stepping stone loans of commercial banks. This is policy loans for ordinary people and loans for apartments worth less than 500 million won, but isn't it too much to limit this? These protests erupted a lot, and the announcement of the suspension of implementation came out immediately in the same week as criticism that the guidance was a little insufficient. In addition, the next week, we will implement it only in the metropolitan area and come up with customized measures and announce them immediately, and it is known that there was a lot of confusion for those who applied for loans in advance, saying that the application of the limit could be reduced.

◆ Cho Tae-hyun: In the end, the Minister of Land, Infrastructure and Transport apologized at the parliamentary inspection, saying he was sorry for the confusion and inconvenience caused to the people.

◇ Kim Kyu-jung: Yes, I even apologized.

◆ Cho Tae-hyun: I don't know how many times the government has apologized like this regarding loans and real estate measures. Anyway, it seems to be repeated quite often, is there anything you've experienced in person like this confusion?

◇ Kim Kyu-jung: First of all, those who signed a contract to cover the balance through stepping-stone loans and designed it will be implemented immediately from the 21st due to a sudden announcement of reduction. I heard that most of them went to the counter because they were very surprised that they would be affected by the information without information, but the details and conditions were unclear and not well informed. As a result, these housing contracts and balances of ordinary people are very important, but I think there was no choice but to point out that they were a little complacent about the announcement and reversal. In this regard, there is a heated debate in the market as to whether it is right to strengthen loan regulations such as stepping stones and supports for ordinary people.

◆ Cho Tae-hyun: I think it was a very complacent approach. Anyway, the Minister of Land, Infrastructure and Transport will come up with a regulatory amendment. That's what I said. What will be included in the amendment?

◇ Regulation Kim: Yes, it is expected that the Seoul metropolitan area should reduce the amount of preferential reimbursement to small leaseholders who have raised the issue to the limit and implement it. There is a possibility that it will be a little difficult to borrow new houses and new apartments that have not yet been registered. So, if you want to use a stepping stone loan after signing a contract for new houses and apartments that have not yet been registered under 500 million won in the Seoul metropolitan area, you should pay close attention to how these changes will be announced in the future. First of all, there was anxiety that the stepping stone loan would disappear, but that's not the case. For now, it is predicted that the announcement will be made in a way that is subject to some conditional loan restrictions depending on the region or target, including the reduced contents.

◆ Cho Tae-hyun: Okay. Until last year, there were movements to lift regulations through special residential theory, but now the situation seems to have completely changed. Anyway, if these regulations are expanded, it will affect the stability of the real estate market, right?

◇ Kim Kyu-jeong: Overall, pressure to strengthen loan regulations while continuing to manage household debt is expected to affect consumers' psychology, but the market recently said that this is a policy loan that homeless ordinary people with an annual income of less than 60 million won receive when purchasing apartments worth less than 500 million won in the Seoul metropolitan area, and whether limiting this will actually affect high-priced apartments in Seoul, which have recently been leading the rise, or whether it is right to regulate such loans. So, we need to see if this stepping-stone loan regulation actually works, and before the strengthening of loan regulations, there was a movement to quickly get loans and just buy a house before the regulation was imposed, so we need to pay close attention to those areas because these regulations up to loans for ordinary people may go to the trend of trying to execute contracts or loans in a hurry.

◆ Cho Tae-hyun: So it's natural to manage household debt, but you can understand that you need to do what you need to manage and release what you don't. Let's point out one more issue related to real estate in the parliamentary audit. The pre-subscription for something very loud was introduced during the Moon Jae In government. There are still cases of giving up this subscription, but LH president has come up with an alternative to this, what is there?

◇ Kim Kyu-jung: Yes. In short, LH said during the parliamentary audit that it would bear the burden of the increase in the sale price due to the continued delay in the main contract. In fact, the competition rate of applications to Gyeyang, Incheon, which recently entered the 3rd new city's main office contract, is much lower than the pre-subscription rate, and the number of winners giving up the main office drug is more than 40%, raising many problems due to delayed schedules and soaring sales prices. Therefore, LH is responsible for the increase in the sale price, which has been delayed by one or two years, and if so, there is a possibility that the pre-subscription winners will be settled by calculating the sale price based on the schedule at the time of the main contract, which was initially discussed. There are more than 70 areas subject to pre-subscription in the future. As it seems that there will be many delays in those areas, there may be disputes in these areas, and there are also LH's financial problems, so there are still concerns about whether they will be properly negotiated and organized. However, there is a minimum welcome atmosphere for these alternatives.

◆ Cho Tae-hyun: It's a welcome atmosphere, but there's still some uncertainty about whether it'll become a reality. Anyway, you need a subscription account to make a pre-subscription. Whether it's pre-subscription or a main contract. However, I recently raised the interest rate on my subscription account, but I don't think my position is still expanding. What do you think is the cause of this?

◇ Kim Kyu-jeong: Yes, first of all, it should be said that the uselessness of the subscription account itself is getting stronger. In the case of Seoul, the sale price has risen so high that it is difficult to think about buying a house even if you have a bank account. There are psychologies of giving up in advance, and the competition for winning in popular areas is so severe that even if I have a bank account, I can't win. These things seem to have an impact, too. In the case of local markets and provinces, unsold contracts and things like this are possible even if you don't have a bank account because of the recent unsold housing, so rather than the need to sign up for a new bank account, there are cases of canceling existing ones. Despite the government raising the deposit rate, creating a comprehensive savings conversion system, and raising the monthly payment recognition, the number of bankbook subscribers has decreased quite a lot this year alone, with about 185,000 fewer subscribers than in early January this year. So if you look at those parts, it is pointed out that the subscription savings account system and the resulting housing city fund management plan may continue to be linked and there may be problems.

◆ Cho Tae-hyun: Popular areas are too expensive and too difficult. Looking at it, there are more people who cancel than subscribers to the subscription account. What problems will arise if the number of subscribers to the subscription account decreases like this?

◇ Kim Kyu-jung: Yes, as I just said, the subscription amount of the subscription account is currently being used as a major source of funding for the Housing City Fund, which is used to implement various housing welfare projects. So LH supplies rental housing or runs an urban regeneration project. Or, as we just talked about, it is also being used in government-supported financial loan projects such as stepping stone loans, support loans, and special loans for newborns, which may reduce the budget of welfare projects or make it difficult to implement them. Overall, as useless things continue to be posted on savings accounts, there are talks that the related systems or systems such as subscription should be continuously repaired.

◆ Cho Tae-hyun: I think it's definitely time for some improvement or reform. I'll also take a look at the real estate market trends. What was the trend of real estate prices last week?

◇ Kim Kyu-jung: Yes, the Seoul area continues to rise, but the weekly rise is shrinking again. After the recent tightening of loan regulations, you may have heard a lot of analyses that the overall trading market has been in a lull, resulting in a significant decrease in transaction volume and an increase in areas where sales are accumulated. The price gap is widening around the outskirts of Seoul and the metropolitan area, and the transaction rate is narrowing. There are areas where sales are gradually accumulated. However, although the trend of slowing down is still a little bit, jeonse prices continue to rise, so there are analysts that we need to see if this trend continues. In addition, as more sales are accumulating in relatively high-priced strong areas and outside areas rather than preferred investment areas, it is pointed out that the polarization and differentiation of each region should be analyzed and responded more carefully in conjunction with regional loan regulations by various conditions.

◆ Cho Tae-hyun: So you're saying it's not an easy time to gauge the overall trend yet?

◇ Kim Kyu-jeong: Yes, it doesn't seem that investor sentiment for buying a house, buying a house or buying one's own house is completely dampened or the demand market is completely out of the market, and some regions continue to see strong jeonse prices coupled with the supply of new apartments, so it seems a little too early to predict the possibility of a significant drop in prices due to the slowdown in transactions and the continued backlog of sales. Based on this slowdown in transactions, those who planned housing transactions in the second half of the year will have to review the appropriate price and loan plan again and continue to take care of them.

◆ Cho Tae-hyun: Okay. As always, you can think of it as a difficult market. Another hot area. Let's look at the hot place that fits the title of our program. Recently, the Seoul Metropolitan Government will make all sections of the ground railway underground. I revealed it like this. I'm not sure if this is really possible, but I think there are already areas that have high expectations. What area is this?

◇ Kim Kyu-jeong: Yes, there are about six routes that are managed by Seoul right now. Among them, a plan was announced to make the entire 68km ground rail section underground sequentially. So, it was announced that all the ground railways would be underground, green areas would be created above, and existing buildings and sites that could be developed would be developed as economic bases by developing cultural and commercial facilities. Representative areas that come to mind right now, such as Seoul Station, the ground rail section around Yongsan, Cheongnyangni Station, or Yeongdeungpo, will be included. So, the Seoul Metropolitan Government announced that the project can be promoted sequentially from 27 by determining the leading area among them. However, in the market, the Seoul Metropolitan Government announced that the current budget estimated for the project cost is about 25.6 trillion won, and there are some questions about whether it is possible or how to raise the budget. However, after this happens, the green space and the growth of new commercial sections that were created during the maintenance of the ground railway in Yeonnam-dong recently. In the case of citizens who have seen these things, it seems to be true that they are also interested in and looking forward to it.

◆ Cho Tae-hyun: Okay. I think it would be better to respond to this part while watching the situation. So far, we have reviewed various news related to real estate with Kim Kyu-jung, a real estate expert at Korea Investment & Securities. Thank you for talking today.

◇ Kim Kyu-jung: Thank you.