Scattered 'Amumal Daejanchi'... Housing Price Surge, Real Buyers' Anger

Government and Ruling Party Flood Uncoordinated Real Estate Remarks
Sejong House Prices Soar by Hundreds of Millions over 'Administrative Capital Relocation'
Greenbelt, Floor Area Ratio, Reconstruction... Confusion Among Actual Buyers

[Asia Economy Reporter Moon Jiwon] The government and the ruling party are causing market confusion by continuously making uncoordinated statements regarding real estate measures. Disorganized remarks on issues that have a huge impact on the market, such as the 'administrative capital relocation,' 'utilization of military idle land,' and 'changes in floor area ratio and reconstruction regulations,' are instead stimulating housing prices in certain areas and only increasing anxiety.

According to the real estate industry on the 24th, after Kim Tae-nyeon, the floor leader of the Democratic Party of Korea, asserted in the National Assembly negotiation group representative speech on the 20th that the National Assembly, the Blue House, and government ministries should all relocate to Sejong City to solve real estate problems, apartment prices in Sejong have surged by hundreds of millions of won, continuing the overheating trend. Even frontline real estate agents describe the price increase as "unprecedented" due to its steep rise.

Kim’s remarks were intended to address real estate issues in the metropolitan area, but they instead made the market more unstable, confirming the rumor that "prices rise when the government endorses." Many experts express the opinion that "while real estate issues can be temporarily controlled, it is difficult to expect effects such as population dispersion in the metropolitan area or a decline in Seoul housing prices."

The industry points out that the ruling party and government are only increasing market anxiety and dissatisfaction by making fragmented statements without coordination among ministries. In fact, when news spread that Seoul, which had conflicts with the government over the lifting of the Greenbelt, might resume reconstruction projects that had been halted for some time, listings decreased and asking prices surged, especially in areas like Yeouido and Apgujeong.

Kwon Il, head of the Real Estate Info Research Team, said, "Since statements vary depending on the speaker without inter-ministerial consultation, confusion in the market is inevitable," adding, "There have been unprecedented changes in plans within just one or two weeks, so it is necessary to conduct sufficient consultations from a long-term perspective and announce measures accordingly."

The government’s words are also exacerbating generational conflicts surrounding real estate. Prime Minister Chung Sye-kyun’s statement during the National Assembly’s government questioning session the day before, that "Taereung Golf Course will be used as a supply measure for actual demanders such as youth, newlyweds, and first-time homebuyers, as agreed among ministries," is a representative example. Because limited resources are specially supplied to newlyweds and youth without groundbreaking supply expansion, complaints of "reverse discrimination" are pouring out, especially from the 40s and 50s age groups.

Moreover, the remark by Kim Hyun-mi, Minister of Land, Infrastructure and Transport, that "housing prices have risen 11% under the current administration" seems to have fueled market anger. This is because it sharply contrasts with private statistics and perceived indices showing that Seoul apartment prices have risen 53% over the past three years.

Some argue that the shift of the weight of real estate measures from the government to the political sphere has rather increased confusion. According to the National Assembly’s legislative information system, since the launch of the 21st National Assembly, the ruling party has proposed nearly 40 real estate-related amendments, including the Comprehensive Real Estate Tax Act and the Housing Lease Protection Act. The problem is that different contents are being proposed for the same laws, such as the rent ceiling system and the right to request contract renewal, which only heightens fear in the rental market.

Professor Kwon Dae-jung of Myongji University pointed out, "Under this government, there are no public hearings to listen to the public’s opinions when issuing real estate policies. Decisions are made and pushed through without gathering opinions," adding, "If the current chaotic situation is left unattended and wrong policies are pushed through without reflection, it will be difficult to control housing prices."

This content was produced with the assistance of AI translation services.