LH Simplifies New Construction Purchase Applications, Allowing Requests Without Design Drawings

[Financial News] Korea Land and Housing Corporation (LH) will simplify the application process for its new construction purchase agreement program in the Capital Region, which uses privately owned land. Applicants will be allowed to submit only a brief project plan instead of design drawings, and sites that pass the preliminary location review will receive benefits in the subsequent screening.
According to LH on the 25th, the corporation has introduced a "simplified new construction purchase application and preliminary location review program." The goal is to ease the time and administrative burden on individuals and companies with little experience in new construction purchase projects, while expanding the supply base for purchase-rental housing in urban areas.
Eligible applicants are individuals or companies that own land in the Capital Region where more than 500 households can be built. In regulated areas, the threshold is 200 households, and quantities from multiple sites may be combined. Eligible sites include idle land created by office consolidation, store closures, factory relocations or shutdowns; business sites managed by financial institutions through trusts, REITs or funds; and idle urban land owned by individuals or clan groups. Properties submitted within the past three years are excluded, and either land ownership or an appraisal consent form is required.
The project plan should be no more than five A4 pages and should focus on location-related factors such as access to public transportation, educational conditions, nearby convenience facilities and the residential environment. Land in multiple areas may be submitted together online.
The newly formed site pre-review committee will determine whether a site is suitable for the new construction purchase program based on the brief project plan. If a site passes the review, it will be exempt from the existing document screening process, and it will receive full marks for location-related items in the later purchase review.
Until now, private developers have had to bear design costs upfront without knowing whether a purchase would actually go through, while companies have said they need preliminary information before board approval for land sales. By allowing them to gauge purchase potential at the pre-review stage, the new process is also expected to reduce the initial review burden on companies and landowners. However, whether the simplified procedure will actually lead to signed agreements remains the key question.
Properties that pass the pre-review must supplement their design drawings within one month to keep the approval valid. LH plans to apply a fast-track process with the goal of signing agreements within this year, and it will accept applications through Subscription Plus until Sept. 15. It will also hold a project briefing on Sept. 1 and offer one-on-one customized consultations through Sept. 14.
Jo Kyung-sook, head of LH's Housing Welfare Division, said, "We will actively use privately owned land to reduce the burden on developers and more quickly supply high-quality purchase-rental housing in prime urban locations."


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