New Satellite Cities Smaller than Bundang

The size of the two or three new satellite cities that the government will decide candidate places for in the first quarter of this year is expected to be 3 to 5 million pyeong. The government will decide whether it will construct the controversial Gyeong-in Canal at the end of this month. Also, interest rates to support national housing funds including public housing construction funds will decrease up to 2%.

“We will decide the sites for 2-3 satellite cities in the Metropolitan area in the first quarter, but the scale will be reduced given declining housing demands due to the moving of the administrative capital,” said Minister of Construction and Transportation Choi Jong-chan, at a press conference today.

A high-ranking official of the Ministry of Construction and Transportation said, “The size of the new satellite cities would be smaller than Bundang (5.96 million pyeong) and larger than Pyeong-chon (1.54 million pyeong).”

This is much smaller scale compared to the government`s announcement of “September 4 measures to stabilize the housing market” which unveiled construction plans for 10 million pyeong satellite cities.

“The Korea Development Institute (KDI) and environmental groups are conducting a joint review regarding the construction of the Gyeong-in Canal to be finished at the end of this month,” Minister Choi also said, “we will decide whether we will build the canal based on the review results.”

He expressed his opposition regarding demands of regulating apartment prices by civic groups, citing “regulating apartment prices only results in speculation.” As for the sell-after-construction system, the minister said, “With a prompt enforcement of the system, there could be many side effects. We should seek complementary measures first. We will commission research institutions to review the system next week.”

In this review, researchers will put emphasis on needed preconditions for the sell-after-construction system and ways to meet the preconditions. The review will be submitted to the Ministry of Construction and Transportation at the end of June.

Jae-Seong Hwang Ki-Jeong Ko jsonhng@donga.com koh@donga.com