[Exclusive] Seoul Metropolitan Government confirms 50 billion won relocation fund—half of the 100 billion won mentioned during the election

[Financial News] Seoul Metropolitan Government has allocated 50 billion won from the Housing Promotion Fund in this year’s second supplementary budget to support members of redevelopment project associations struggling with regulations on relocation loans. The amount is roughly half of the 100 billion won mentioned by Seoul Mayor Oh Se-hoon during the local election campaign in June. As 384 association members applied for the second round of relocation support, criticism is growing on the ground that the fluctuating fund size “only adds to the confusion.”
■Confusion grows on the ground as relocation support is reduced
A review of Financial News’ reporting on the 29th found that Seoul Mayor Oh Se-hoon said during his local election campaign in June that he would increase the Housing Promotion Fund from 50 billion to 100 billion won. Seoul Metropolitan Government subsequently issued no separate position on restoring the fund to its previous level or related matters. However, the second supplementary budget approved recently by Seoul’s Special Committee on Budget and Accounts set the fund budget at 50 billion won. In effect, it was cut in half from 100 billion won. A Seoul Metropolitan Government official said, “It is true that the issue was raised during the election campaign,” but explained, “After conducting an actual review, we adjusted the budget because that amount—100 billion won—was not necessary.”
The problem is that continued policy changes are causing confusion on the ground. A member of a redevelopment project association in Seoul whose relocation is underway said, “The amounts of 50 billion and 100 billion won have been going back and forth like a rubber band,” adding, “Many people on the ground still believe that the support amount is 100 billion won.” The member criticized the policy, saying, “Seoul Metropolitan Government introduced it by saying it would provide support because of the many government regulations, but I do not know whether it truly intends to provide that support.”
■384 apply for second-round relocation support
Contrary to Seoul Metropolitan Government’s prediction that 50 billion won would be sufficient, relocation support is urgently needed on the ground. In fact, 384 members of associations from seven complexes applied during the second-round recruitment held from July 2 to 16. Even assuming 100 million won per person, the total would be 38.4 billion won. If the support is increased to 200 million won per person, the total would easily exceed 76 billion won. This is why members of redevelopment project associations are criticizing the plan, saying that “even 100 billion won is not enough.”
Seoul Metropolitan Government first deemed 37 members from three complexes eligible and confirmed their support. Two of the complexes are currently undergoing relocation, while the third is about to begin relocation. The total support amount is 9.3 billion won, averaging between 200 million and 300 million won per person.
The silver lining is that the 50 billion won budget has been secured. As recently as the end of June, only about 22 billion won had been secured.<See Financial News’ June 29 report, “[Exclusive] Seoul Metropolitan Government fails to secure even half of relocation budget... only nine receive first-round support.”>
The increases in the loan limit and the scope of eligible recipients announced alongside the fund expansion will remain in place. At the time, Seoul Metropolitan Government decided to raise the loan limit from 300 million to 500 million won and expand eligibility from small and medium-sized associations with 500 or fewer members to all associations.
Applications for the third round of relocation support are scheduled to open from October 1 to 15. The industry expects a large wave of applications, including from 300 members of four complexes whose first-round applications were rejected. A Seoul Metropolitan Government official explained, “Some of the complexes that applied were scheduled to begin relocation in November or December,” adding, “We decided to support the complexes that needed to relocate urgently first.” 

[email protected] Kwon Jun-ho Reporter