Byeon Chang-heum: "Land Lease Housing, Conditions Have Changed Compared to the Past"

Minister of Land, Infrastructure and Transport nominee Byeon Chang-heum is arriving at the hearing preparation office set up at the Seoul Regional Land Management Office in the Government Complex Gwacheon, Gyeonggi Province on the 21st. / Gwacheon - Photo by Kim Hyun-min kimhyun81@

[Asia Economy Reporter Lee Chun-hee] Byun Chang-heum, the nominee for Minister of Land, Infrastructure and Transport, expressed his determination to push forward policies such as land leasehold housing, which have been criticized as "already failed policies." He emphasized that the situation has changed from the past and that these policies are necessary for the current market conditions. In addition, Byun stated his intention to continue the current government's policy direction, including nationwide designation of regulated areas and the three lease laws.

In response to a written inquiry submitted to the National Assembly on the 21st, Byun addressed the question from Jeong Dong-man, a member of the People Power Party, who pointed out that public owner-occupied housing policies such as land leasehold housing and repurchase condition housing are "policies that have failed in the past." Byun said, "The demand for affordable housing supply is increasing, and the conditions surrounding the projects have changed compared to the past," expressing his intention to proceed with the projects.

Byun acknowledged, "In the case of repurchase condition housing in Bugok, Gunpo, it was promoted as a pilot project and was sold at relatively high prices, resulting in many unsold units," but he countered, "However, the recent high housing prices in Seoul have become a social issue," arguing that the policy is suitable for the current real estate market situation.

He further emphasized, "Especially in a housing market divided between sales and rentals, the need to supply customized housing to meet the demand of those who want to secure their own homes at affordable prices and achieve residential stability is increasing."

Byun also stressed the necessity of introducing public owner-occupied housing by citing overseas examples. He mentioned, "The UK government is implementing the 'Home Buy' program to support homeownership for middle- and low-income groups and those with low purchasing power." The Home Buy program allows individual households to share housing ownership stakes with public institutions and private developers and recover their investment proportionally when disposing of the property.

Byun explained, "If appointed as minister, I will carefully review ways to mix sales, rentals, and public owner-occupied housing in high-demand urban areas according to conditions and ensure that public owner-occupied housing can be supplied at appropriate prices."

Meanwhile, Byun also revealed his stance on various regulations. In response to Jeong's question that "house prices are rising nationwide despite loan regulations, and the balloon effect continues due to the designation of adjustment target areas," Byun answered, "These are inevitable regulations to block the inflow of market liquidity into the housing market and to protect local residents by curbing house price increases caused by speculative demand from outsiders."

Byun reiterated his previous position that external factors such as macroeconomics and COVID-19, rather than government policies, are the main causes of market instability. He stressed the necessity of designating regulated areas, saying, "Global low-interest rates and abundant liquidity resulting from COVID-19 responses have flowed into local housing markets, acting as structural instability factors." He also explained that various factors such as gap-filling due to relative low-price perception and development prospects are complexly contributing to housing price increases.

Byun maintained a positive stance on the three lease laws. In response to Jeong's question that "the three lease laws are rather encouraging disputes," Byun said, "I understand that both supply and demand for jeonse (long-term deposit lease) have decreased, making it difficult for new tenants to find listings, and that changes in transaction practices have caused conflicts and frictions related to leases." However, he added, "There are also positive effects, such as an increase in contract renewal rates among existing tenants after the law's implementation," and pledged to uphold the system while addressing its issues to ensure early stabilization.

He also stated that the passage process of the three lease laws was conducted according to parliamentary procedures and expressed that there is no problem with it.

Jeong Dong-man, member of the People Power Party.
[Image source=Yonhap News]

Byun also clarified controversial remarks related to past housing policies. Regarding his comment that real estate community websites were hotbeds of speculation, he explained, "I pointed out that in a situation where there is information asymmetry among housing market participants, the spread of distorted information can provoke anxiety among actual demanders." About his claim that higher homeownership rates tend to correlate with conservative tendencies, he responded, "Considering the widening gap in homeownership rates between generations, I wanted to emphasize the need to focus on housing policies for the youth."

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