[Initial Perspective] Justice (正義) Without Definition (定義)

[Image source=Yonhap News]

[Sejong=Asia Economy Reporter Kim Hyun-jung] The country is on the verge of splitting in two because of real estate. Market participants, divided into homeowners and non-homeowners, and further into landlords and tenants, have started to dislike each other more than before. Everyone seems to feel that the hardships of their own camp are being converted into benefits for the other side, causing frustration to boil over. This is because government policies are blatantly taking from one side and giving to the other.

There is something the government, which loudly proclaims 'justice' in the real estate market despite causing such intense conflict, has overlooked. That is to clearly define the concept it claims, to establish a 'definition (定義).' At least in the process where the law operates, things that should be clear are repeatedly left vague. Considering that the looser the definition of justice, the more disputes arise and the more people feel wronged, this is a part that must be resolved and moved past.

First, regarding speculation, which the government considers the main culprit behind the rapid rise in real estate prices. According to the Korean dictionary, speculation refers to buying and selling transactions made to gain profits by anticipating price fluctuations. Investment is defined as spending capital and time on a certain work or business to gain profits. The difference is so subtle that it seems to hinge on whether the suffix 'kkun' (meaning 'person who does') is attached or not. In 2018, Minister of Land, Infrastructure and Transport Kim Hyun-mi explained this difference in response to a question from a lawmaker, saying, "If you aim for short-term price gains, it is speculation; if it is a long-term approach, it is investment."

Then how are short-term and long-term defined? Is the government's punitive taxation through capital gains tax on 'holding less than one year' the standard? If any lawmaker has made a large profit from housing sales or sold within one year of purchase, they are clearly a speculator and a market disruptor?so do they deserve to be in the legislative body? Especially when high-ranking officials are required to own only one house, if they have made such irreverent price gains. If all acts of seeking profits in the process of buying and selling houses are defined as speculation and targeted for eradication, what other reason besides concerns about tax resistance is there for the law to allow some to remain?

The real demanders, whom the government promises to protect, are also not clearly defined. This is especially true in the subscription market. In an era where real estate essentially means 'apartments,' if someone has purchased a villa or multi-family housing out of urgency due to lack of funds, why should they be penalized in the subscription market compared to those without such experience? Is there any basis or reality that the latter are more economically disadvantaged and thus deserving of consideration? Why does the government, which vehemently condemns unearned income, use public authority to suppress apartment prices below market value and allow winners to earn billions of won on the spot? The government plans to mandate a residence period for apartments won through subscription?does this mean that the price gains after living there for a few years will not be considered unearned income?

Is the new paradigm of the housing market, which the state promised to lead, a success or a failure? The housing rental business system, which aimed to expand private supply by offering various tax benefits and promotions, was abolished after just three years, leaving behind quick cherry pickers, yet no one admitted failure or apologized. In 2018, the government declared it would gradually introduce post-sale to prevent blind pre-sales, but recently suddenly announced pre-subscription for the 3rd new town. Leaving aside the issue of queue-jumping in the 2nd new town, what is happening to the post-sale roadmap that the government intended to make a new principle spanning from public to private sectors?

The above questions are neither to defend someone nor to belittle the desperation of others. The reporter also experienced a shocking case where a landlord raised the monthly rent by more than 50% amid the strong discussion of the enactment of the three lease laws. This is the market and reality. Justice (正義) lumped together without definition (定義) cannot correct the problem.

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