5-Year Lease-to-Purchase Public Housing to be Available from November

Starting from November this year, a new public housing program will allow tenants to purchase their rental units after living in them for six years

Starting from November this year, a new public housing program will allow tenants to purchase their rental units after living in them for six years. A total of 50,000 units are planned to be offered to non-homeowners by next year. Additionally, the Housing & Urban Guarantee Corporation (HUG) will introduce 16,000 units of its "HUG Solid Lease Housing" program by next year, which involves purchasing properties that have faced rental deposit return guarantee incidents.

On the 22nd, the Ministry of Land, Infrastructure, and Transport announced new measures for public rental housing aimed at non-homeowners. This initiative is a follow-up to the August 8th Supply Plan, which promised to provide 110,000 units of public rental housing to stabilize the non-apartment housing market.

The new lease-to-purchase program will allow tenants to live in a property for six years under either a rental or lease agreement before deciding whether to buy it. The Land and Housing Corporation (LH) will primarily offer newly built villas, office buildings, and apartments in good locations, with sizes ranging from 60 to 85 square meters. The purchase price will be set as the average of the property's appraised value at the time of move-in and at the time of purchase. This program will not require a subscription to a lottery system for purchasing.

The lease-to-purchase program is divided into two types: the "LH Solid Lease" and the "Newlywed and Newborn Family Lease-to-Purchase". The LH Solid Lease requires a deposit equivalent to 90% of the market rate and allows tenants to live there for up to eight years. By next year, 22,000 units of this type will be available. The Newlywed and Newborn Family Lease-to-Purchase allows living for up to 20 years at 30% to 80% of the market rate, with some larger units available for purchase if the tenant chooses.

Additionally, the Ministry announced that HUG will supply 16,000 units of its "HUG Solid Lease" program by next year, an increase of 6,000 units over the original plan. This program offers rental housing at 90% of the market rate to non-homeowners. Unlike LH, which buys newly constructed properties, HUG acquires homes that have experienced rental deposit guarantee incidents.

To expedite the supply of HUG Solid Lease units, a new "HUG Solid Lease Housing II" program will be introduced. Previously, HUG acquired properties through auctions, which took over a year. The new method involves direct negotiations with property owners to speed up acquisition.

Under the new process, if a property owner applies for a negotiated purchase and sells their property to HUG, the remaining debt, after deducting the purchase price from the indemnity payment, will be deferred for six years. The owner will also have the option to repurchase the property from HUG after clearing the debt.

Starting from the 6th of next month, property owners can apply for negotiated sales. However, only those who own two or fewer properties with rental deposit guarantees can apply.

The new lease-to-purchase and HUG Solid Lease programs are part of a broader strategy to provide affordable housing options for non-homeowners while addressing issues with rental deposit guarantees. These initiatives aim to stabilize the housing market and support those in need of stable and affordable living arrangements.