In the End, Real Estate and Anger Over Hope Election..."Increasing Correlation Between Apartment Prices and Vote Share"

[Image source=Yonhap News]

[Asia Economy Reporter Park Cheol-eung] The by-election landscape is swirling around fairness, deprivation, and anger related to real estate. As the speculation scandal involving some employees of Korea Land and Housing Corporation (LH) erupted, the ruling party found itself on the defensive, while opposition candidates faced allegations over tens of billions of won in capital gains. This is because real estate issues are seen as directly affecting voter sentiment, and in fact, since the 2017 presidential election, the impact of apartment prices on vote shares has sharply increased in elections.

According to a report analyzed by Research View, a polling and political consulting firm, the correlation coefficients between the average apartment sale prices by neighborhood in Seoul and the vote shares of Democratic Party-affiliated parties were 0.32 in the 2017 presidential election, 0.46 in the 2018 local elections for metropolitan proportional representation, and 0.60 in the 2020 general election proportional representation (Democratic Party of Citizens + Open Democratic Party). For People Power Party-affiliated parties, the coefficients were also high at 0.24, 0.37, and 0.62 in the same elections.

This is a regression analysis method that statistically estimates the relationship between variables, and a value above 0.16 indicates a correlation, while above 0.49 is interpreted as high.

This means that the higher the apartment prices, the stronger the support for conservative parties. Research View explained, "Looking only at the last general election proportional representation, for every 1 million KRW increase in the average apartment sale price per square meter, the Democratic Party-affiliated proportional vote share decreased by 1.2 percentage points, while the Future Korea Party (a proportional representation party) vote share increased by 1.5 percentage points."

Under the Moon Jae-in administration, apartment prices soared and the effective rate of property tax increased, raising the tax burden on homeowners and lowering the ruling party’s vote share. Even non-homeowners feel a greater sense of deprivation, which appears to influence voter sentiment as well.

In this situation, the misconduct of LH employees handling public information ignited public anger. Meanwhile, the People Power Party faces allegations of special favors, such as the 3.6 billion KRW land compensation for the Naegok-dong housing site related to Seoul mayoral candidate Oh Se-hoon’s in-laws, and the purchase of two apartments in Haeundae LCT worth around 2 billion KRW by families of Busan mayoral candidate Park Hyung-joon. In Seoul, although there was competition over pledges such as housing supply plans, railroad undergrounding, and utilization of roads above the Han River, these have now been overshadowed by allegations and disputes.

Research View CEO Ahn Il-won said, "In Seoul, the correlation between vote shares and real estate class is becoming clearer than that with household numbers," adding, "The real estate issues raised in this by-election are expected to have an even more sensitive impact on public sentiment."

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