LH incurs 290 million KRW in debt for every rental unit built... "Debt Bomb" as public housing expands

‌LH incurs 290 million KRW in debt for every rental unit built... "Debt Bomb" as public housing expandsn.news.naver.comIt has been revealed that the debt incurred by the Korea Land and Housing Corporation (LH) when supplying a single unit of integrated public rental housing reached 288 million KRW last year. This comes as the project costs required for constructing public rental housing are increasing faster than government subsidies, and the government is expanding supply.
According to data submitted by LH to Rep. Kang Dae-sik of the People Power Party, a member of the National Assembly's Land, Infrastructure and Transport Committee, on the 2nd, the debt incurred per unit of integrated public rental housing last year was tallied at 288 million KRW. This represents a 60.9% increase in just four years from 179 million KRW in 2021.
Integrated public rental housing is a type of public rental housing that combines permanent, national, and happiness housing into one, supplied to low-income groups, youth, etc. The mandatory rental period is 30 years, and rent is applied differentially at 35–90% of market rates depending on income levels.
LH's debt ratio is also expected to rise. According to LH's mid-to-long-term financial management plan for 2025–2029, the debt ratio is projected to rise from 239.0% this year to 250.5% next year, reaching 262.1% in 2028, before recording 260.3% in 2029. Total interest expense is also estimated to increase from 2.8894 trillion KRW this year to 3.6019 trillion KRW by 2029.
In relation to this, Rep. Kang stated, "Rather than just prioritizing the policy direction of expanding public rental housing, we must also examine the financial soundness of LH, which must actually execute it." He added, "The debt burden per rental unit has already increased significantly, and since the expansion of LH's direct implementation has not been reflected in existing financial forecasts, the government must clearly state the financial burden and countermeasures regarding housing supply."