Magok District 17 Tenants Face Financial Hurdles; Bank Loan Denials Hamper Balance Payments

Potential tenants of Seoul's Magok District 17 are expressing concerns over their inability to secure bank loans for the remaining balance due to a structure where individuals cannot own the land. The prospective tenants had their loan applications rejected by commercial banks and have launched strong protests, including rallies, ahead of the move-in scheduled for the 28th. Magok District 17 is a public land lease housing complex where SH owns the land, making individual collateral loans structurally impossible. Financial authorities stated that this situation is unrelated to the loan-to-value (LTV) regulation system.

The loan conditions announced during the subscription phase—an annual interest rate in the 2% range, a loan-to-value (LTV) ratio of 80%, and a maximum loan of 500 million won—have seen the LTV reduced to 60% due to government regulations. The Ministry of Land, Infrastructure and Transport announced that it would honor the original promises for preliminary subscribers but apply the changed conditions to general subscribers. General subscribers argue that proper guidance and correction notices were not provided during the subscription period. Contrary to initial advice that 70 million won in initial assets would suffice, the actual required funds have surged to the 200 million won level.

Tenants plan to hold a candlelight rally with 300 participants this weekend in front of the Government Complex in Gwanghwamun ahead of the move-in on the 28th. Choi Ho-jung, chairman of the SH Land Lease Housing Emergency Countermeasure Committee, stated that unsecured loans are insufficient to cover the balance, and young people who lack financial support from their parents are being forced to give up on moving in.