Public housing sales are delayed, and rental supply is drying up — land that can be used now has become urgently needed

The Ministry of Land, Infrastructure and Transport launched an emergency survey of private nonresidential land that is difficult to convert because of district unit plans, as immediate supply is urgently needed. Major apartment projects, including Third New Towns, are facing red flags due to delays and a lack of participants. By contrast, privately held nonresidential land can be converted to residential use right away through changes to district unit plans.
■ Public housing supply in the Seoul metropolitan area is at a standstill
On the 17th, Financial News analyzed Ministry of Land, Infrastructure and Transport data and found that public housing projects, including Third New Towns, are being delayed across the board. Some blocks have been pushed back by one to two years, and public-private projects are struggling to find developers.
In fact, the project period for Goyang Changneung S3 Block and S4 Block was recently extended by 15 months, from December 2028 to March 2030. S3 Block is set to supply 1,306 profit-sharing sale units, while S4 Block will provide 1,024 public sale units.
Other Third New Towns projects are also being delayed one after another. Namyangju Wangsuk 2 District A1 Block, which will supply 803 public sale units, was extended by 21 months, from May 2027 to February 2029.
Nearby, Namyangju Wangsuk 2 District A3 Block also saw its project period lengthened by 26 months, from May 2027 to July 2029.
In public-private projects, securing developers has also become difficult during the project rollout. Korea Land and Housing Corporation (LH) recently reissued a call for private developers. In the case of Goyang Changneung B1 Block, the earlier recruitment of public-private partners failed to attract bids, leading to a new announcement.
These delays are not limited to Third New Towns. Across public housing projects in the Seoul metropolitan area, schedule extensions and setbacks in developer recruitment continue. This year, the Ministry of Land, Infrastructure and Transport has approved changes to public housing construction plans at 31 sites. At Seongnam Nakseong A1 Block, where Newlywed Hope Town is being developed, the project period was also extended by 49 months, from December 2025 to January 2029.
■ Private nonresidential land should be put to use
The government’s decision to survey idle private land in the Seoul metropolitan area can also be understood in this context. With rental market instability and other pressures, the market needs housing supply now. However, public housing projects and the conversion of vacant nonresidential properties to residential use alone have clear limits.
In reality, many sites are struggling to convert to residential use because of district unit plans. At one site in the Seoul metropolitan area, a change in the district unit plan is being pursued to turn the land into an apartment site, but negotiations over the scale of public contributions have dragged on. At another site, a five-year retention rule has prevented even an attempt to revise the district unit plan.
A Housing Association official said, "This survey appears to be part of efforts to expand housing supply," adding, "Given the Ministry of Land, Infrastructure and Transport's recent moves, we are also hoping for bold measures."
A senior industry official emphasized, "Given the current situation, a shortage of apartment supply is a foregone conclusion, and improvement will not be easy," adding, "To minimize side effects, supply must be increased by making the most of privately held land."
Lee Eun-hyung, a Research Fellow at Korea Research Institute for Construction Policy (RICON), said, "In the case of Third New Towns, it is a reality that progress cannot move quickly," and added, "For changes in land use for private plots, local government approval is required, so it is important to come up with reasonable alternatives to concerns over favoritism."
ljb@fnnews.com Lee Jong-bae, Choi A-young Reporter