New Residential Sites May Be Announced as Early as July... But Legislative Process for Speculation Measures Lags Behind

Concerns Raised as Government Plan Emphasizing 'Smooth Follow-up Measures' Falls Apart

Kim Su-sang, Director of the Housing and Land Office at the Ministry of Land, Infrastructure and Transport, is making a presentation at the 5th Weekly Housing Supply Briefing held at the Government Sejong Complex on the 29th.

[Asia Economy Reporter Jo Gang-wook] The government's housing supply measures have been hampered by 'speculation.' The second phase of new public land, originally scheduled to be announced this month, has been postponed to the second half of the year due to the discovery of multiple suspected speculation cases. The government plans to unveil new land as early as July after completing legislative amendments to eradicate speculation. However, concerns are growing that the supply measures will face setbacks as the legislative process is not progressing swiftly.

According to the government on the 30th, the announcement of new land supply for 131,000 households, originally scheduled for the 29th, has been postponed until investigations into speculation allegations and legislation on speculation countermeasures are completed.

According to the schedule initially set by the Ministry of Land, Infrastructure and Transport in the 2·4 measures, new land was to be disclosed 'two to three times in the first half of this year.' After the announcement of the Gwangmyeong-Siheung district with 101,000 households on February 24, the ministry had firmly maintained its position to announce new land supply of 149,000 households on the 29th of this month until last week. However, the situation changed within a week, with only a small-scale local supply of 18,000 households announced, and the much-anticipated second phase of new land in the metropolitan area is unlikely to be disclosed for at least two to three months.

The Ministry of Land explained that the delay was due to the need for in-depth investigations and police investigations after confirming numerous preliminary signs of speculation in candidate areas. In fact, the investigation revealed that land transaction volumes increased more than eightfold within half a year, and clear signs of outside investors and share transactions were evident, indicating the situation was more serious than expected. Ultimately, as the real estate issue emerged as a political flashpoint following the LH speculation scandal, it appears that there is a consensus within the government that eradicating speculation and establishing measures to prevent recurrence must take priority.

However, with the delay in announcing new metropolitan area land, the government's plan, which had emphasized 'uninterrupted' follow-up measures to curb rising housing prices, has been completely disrupted. The volume announced so far falls short of even half of the government's housing supply target of 250,000 households. This is why the market is expressing concerns that the supply signal for housing price stabilization may be compromised.

The variable is the legislation on speculation eradication measures. Given the severity of speculation signs, the government plans to disclose new public land immediately after completing legislative amendments to eradicate speculation. Once follow-up legislative measures and institutional devices are in place, it will be possible to promote speculation eradication across all stages, including prevention, detection, punishment, and recovery.

However, the legislative process remains sluggish. To enforce the 'Real Estate Speculation Eradication and Recurrence Prevention Measures,' which include 20 detailed policies, 19 related bills must be supported, but less than half have been proposed so far. Only the Conflict of Interest Prevention Act, which prohibits public officials from gaining private benefits using job-related information, passed the National Assembly's Political Affairs Committee on the 22nd. Amendments related to the Agricultural and Fishery Management Act, Rural Development Corporation Act, Judicial Police Duties Act, Housing Act, and Land Compensation Act have yet to be discussed in the relevant standing committees.

An industry insider pointed out, "Following the ruling party's defeat in the by-elections, there are calls to lower comprehensive real estate tax and property tax, which seems to have delayed moves to strengthen taxation and speculation penalties," adding, "It is uncertain whether the ruling and opposition parties will smoothly reach an agreement on related bills such as the Real Estate Transaction Reporting Act, Land Compensation Act, and Special Act on Public Housing."

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