Posted August. 18, 2009 06:31,
Monthly rent vouchers worth between 70,000 (55 U.S. dollars) and 130,000 won (103 dollars) will be offered to 1.42 million households in the lowest income bracket over the next 10 years.
The Land, Transport, and Maritime Affairs Ministry yesterday said it has asked the Strategy and Finance Ministry for a budget of six billion won (4.7 million dollars) for a pilot housing voucher program for launch next year.
To provide practical housing benefits to the working class, we plan to introduce as soon as possible the housing voucher program that pays monthly rent, the Land Ministry said. Accordingly, we received a report on how to introduce the housing voucher program drafted by the Housing and Urban Research Institute under the Korea National Housing Corp. and to coordinate the beneficiaries, program scale and schedule.
The report said those eligible for the program are households paying more than 20 percent of their monthly income for rent among those in the lowest 20 percent of the income bracket and who do not own homes.
These include households among the lower 20 percent in aggregate household income among the urban working class who do not own homes, but do not receive state financial assistance including subsidies for living costs, housing and senior citizen support.
The government plans to give vouchers to households living in rental homes, considering that families paying rent live in worse housing than those living in homes requiring jeonse, or rental in exchange for a lump sum deposit rather than monthly rent.
Last year, the number of households that did not own homes reached 2.92 million nationwide, or 18.3 percent of all households. If the 1.5 million homes to be guaranteed long-term rental housing to be built for low-income families by 2018 are excluded, 1.42 million families can benefit from the housing voucher program.
The rent to income ratio of people in this category is 40 to 52 percent. The government must pay 80,000 (55 dollars) to 130,000 won (103 dollars) per household a month to reduce this ratio to 20 percent, the figure recommended by the Organization for Economic Cooperation and Development.
If the voucher program is to be implemented, however, between 246 billion won (195.6 million dollars) and 1.3 trillion won (1.03 billion dollars) will be needed per year. Accordingly, the key to the program is how to obtain the required budget.
Hence, ideas under consideration include the creation of a housing welfare fund partially funded by the private sector or allocating part of the costs to provincial and municipal governments.