"Apartments Illusion" "Lease Law is Growing Pains"... Ruling Party and Government Fuel Real Estate Anger

Jin Sun-mi "We Must Abandon Illusions About Apartments"
Yoon Sung-won "The Lease Law Is a Growing Pain We Must Experience"
Kim Hyun-mi "Lease Law Achieved Through Social Consensus"

Minister of Land, Infrastructure and Transport Kim Hyun-mi is briefing on support measures for housing stability for low-income and middle-class citizens at the Government Seoul Office in Jongno-gu, Seoul, on the morning of the 19th. Photo by Kang Jin-hyung aymsdream@

[Asia Economy Reporter Moon Jiwon] Amid the worsening jeonse (long-term lease) crisis caused by the new lease law and low interest rates, remarks related to real estate from the government and ruling party have sparked continuous controversy.

Jin Sun-mi, a member of the National Assembly who serves as the Chair of the Land, Infrastructure and Transport Committee and the Head of the Democratic Party's Future Housing Promotion Team, visited LH's purchased rental housing such as Elim House in Dongdaemun-gu, Seoul, and Seodohuville in Gangdong-gu on the 20th, stating, "There is no difference at all compared to the apartment I currently live in."

This is interpreted as an attempt to emphasize the advantages of purchased rental housing, which accounts for the largest share of supply in the government's 'Support Measures for Housing Stability for Low- and Middle-Income Classes' announced the previous day. She added, "There are even three rooms, so this information should be provided accurately," and "If you give up the illusion of apartments, you gain confidence that you can secure quality housing even in rental housing."

However, upon hearing these remarks, people criticized Jin for hypocrisy, pointing out that she actually resides in an 84㎡ unit of Raemian Solvenue in Myeongil-dong, Gangdong-gu, Seoul. Kim Ye-ryeong, spokesperson for the People Power Party, also commented verbally, "If multi-family rental housing is no different from the apartment Jin lives in, why does she live in an apartment instead of rental housing?"

Yoon Sung-won, the First Vice Minister of the Ministry of Land, Infrastructure and Transport, also appeared on MBC Radio's 'Kim Jong-bae's Focus' the day before and said, "The three lease laws are a growing pain that our economy, with a per capita income exceeding $30,000, must go through at least once," drawing public criticism.

Since the implementation of the rent cap and contract renewal request system at the end of July, the jeonse crisis has deepened, increasing housing insecurity among low-income people, and there were criticisms that simply dismissing this as 'growing pains' was inappropriate.

Vice Minister Yoon actively refuted the claim that the three lease laws triggered the jeonse crisis. He said, "Jeonse prices have been rising since the second half of last year when interest rates were falling, and the current increase is due to a combination of various factors," adding, "Although we receive much criticism that the three lease laws are the main culprit of the jeonse crisis, our opinion is otherwise."

On the 20th, Jin Sun-mi, head of the Future Housing Promotion Team of the Democratic Party of Korea, along with other lawmakers, toured the rental housing building at LH Maeip Rental Housing Seodohuvil located in Gangdong-gu, Seoul, during an on-site meeting for the housing welfare project. (Photo by Jin Sun-mi's Office)

Minister of Land, Infrastructure and Transport Kim Hyun-mi also bowed her head and apologized to the public struggling to find new jeonse homes during a briefing on the 19th about the jeonse measures, but reiterated that the three lease laws are not a cause of the jeonse crisis.

Minister Kim emphasized, "The three lease laws are a precious achievement based on the social consensus that a house is a place where people live," and added, "The way to spread the positive effects of tenant housing stability throughout the lease market is to stabilize jeonse supply and demand so that the three lease laws can be established early."

While the market evaluates that the new lease law was implemented amid a shortage of jeonse listings due to prolonged low interest rates and increased demand for subscription waiting, causing the jeonse crisis to spread significantly, the government does not acknowledge any policy mistakes.

The new jeonse measures, which plan to supply 114,000 jeonse-type housing units nationwide, are also criticized by the market for their lack of substance. Although the government recently announced it would secure jeonse supply at a level comparable to 'all-in' efforts to resolve the serious social issue of the jeonse crisis and supply it from next year, most of the units are small public rental and multi-family housing, leading to analyses that the effect will be limited.

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