This research is to investigate the concept of Local Housing Association, and stepwise implementation procedure, through the theoretical consideration, and then to find out overall problems happening in the process of pushing ahead with Local Housing Association, including problems in the corresponding business stage, based on the cases of Local Housing Association that have been appearing in Changwon areas, Gyeongnam, and to present legal and policy directions for solutions to it, based on it. First, regarding improvement measures at the stage of promotion committee, it is necessary to introduce the system to report the establishment of promotion committee to cities, provinces, and districts under the jurisdiction of the location of overall business, for the establishment of association. In order to secure the professionalism of promotion committee, it is necessary to enforce those members to receive education and training for a certain period, and improve the system to post on Website or through public notices. Second, regarding improvement measures at the stage of the approval of establishment, Local Housing Association have difficulties in replacing members and joining new memberships, after getting the approval of the establishment, which can put the brake on business operation. Finally, in order to prevent crime actions, such as embezzlement or breach of duty, in advance, it is necessary to establish the institutional system that allows every member to check details of business fund. It is expected that this research would minimize side effects incurred by Local Housing Association System and help Local Housing Association take full institutional responsibility and play an axis of housing supply policy.