"If the government cleanly gives up the capital gains tax, it's done" 청 Real Estate Petition Sparks Debate

Petitioner Proposes Introduction of So-Called 'Housing Purchase Points System for Non-Homeowners'
"If the Government Waives Taxes and Provides Support, Housing Transactions Will Revitalize"

[Asia Economy Reporter Heo Midam] Recently, a petition proposing the introduction of the so-called 'No-Homeowner Housing Purchase Points System' as a way for no-homeowners and multi-homeowners to coexist has gained attention on the Blue House's national petition board. The 'No-Homeowner Housing Purchase Points System' advocated by the petitioner is a system where the government waives the capital gains tax that multi-homeowners must bear and redistributes it between multi-homeowners and no-homeowners.

On the 4th, a petition titled "Real Estate Policy Proposal: Proposing the 'No-Homeowner Housing Purchase Points System' for Coexistence Between No-Homeowners and Multi-Homeowners" was posted on the Blue House national petition board.

The petitioner opened by saying, "Despite 25 real estate policies, real estate prices have not been controlled," adding, "As a result, it is becoming increasingly difficult for ordinary people without homes to secure housing."

He continued, "Although there is a subscription system, soaring housing prices have increased competition rates, making it even harder for young people with low subscription points to secure housing. Since housing supply policies rely only on new sales, the supply volume is insufficient, and waiting times only increase," he pointed out.

Additionally, the petitioner said, "Multi-homeowners who own several houses are also facing increasing difficulties," explaining, "They want to sell their houses but are enduring government policies rather than selling due to the heavy burden of capital gains tax."

He criticized, "Ultimately, multi-homeowners do not sell, no-homeowners cannot buy houses, transactions decrease, prices rise, and no real stabilization of the real estate market occurs."

Then, the petitioner proposed a real estate policy where no-homeowners and multi-homeowners can coexist, suggesting the 'No-Homeowner Housing Purchase Points System.'

Regarding this, the petitioner explained, "This system allows no-homeowners to use the subscription point benefits they get when applying for new housing to also benefit when purchasing existing homes, enabling them to buy existing homes at a lower price."

Photo by Cheongwadae National Petition Board capture.

He said, "There may be criticism asking, 'Are you saying existing homeowners (multi-homeowners) should sell their houses cheaply?' That is not the case," explaining, "Multi-homeowners bear capital gains tax when selling houses. The government supports no-homeowners by covering part of the capital gains tax that multi-homeowners pay."

He added, "There may be objections asking, 'What benefit do multi-homeowners get?' The capital gains tax for multi-homeowners selling to no-homeowners can be reduced," and said, "We can also consider increasing the capital gains tax reduction rate the more the house is sold to people with higher subscription points."

Furthermore, the petitioner gave an example where a house owned by a multi-homeowner has a market price of 1 billion KRW, a capital gain of 500 million KRW, and a capital gains tax of 300 million KRW, saying, "If a multi-homeowner sells a house, they receive 700 million KRW. However, if the multi-homeowner sells to a no-homeowner with a 50% reduction in capital gains tax, only 150 million KRW is taxed, and the government supports the 150 million KRW collected in capital gains tax to the no-homeowner, so the multi-homeowner receives 850 million KRW, benefiting from the capital gains tax reduction." He added, "The no-homeowner can buy a house worth 1 billion KRW for 850 million KRW."

He said, "Rather than struggling over capital gains tax rates like now, if the government cleanly waives the tax and supports the people, housing transactions will be revitalized," adding, "No-homeowners will be able to buy existing homes at prices lower than market value rather than only focusing on new sale announcements, which are uncertain, stabilizing the subscription market."

Moreover, the petitioner emphasized, "Everyone knows that it is difficult for housing prices that have already risen to return to past levels. While prices could fall sharply to past levels, that would be economically more dangerous at this point," stressing, "We need to accept the current market situation and take wise measures suitable for this situation."

Earlier, the government announced on the 1st that it would significantly increase holding and capital gains taxes on multi-homeowners. However, some multi-homeowners predict that housing prices will rise further and choose to gift properties to their children or hold on rather than putting them on the market.

According to the Korea Real Estate Board's monthly housing transaction status by cause, in April, the number of housing gifts in Seoul reached 3,039, the highest monthly figure this year. In other words, despite government pressure, multi-homeowner properties are not coming onto the market.

Meanwhile, housing prices in the metropolitan area have been sharply rising this year. According to the Korea Real Estate Board's monthly statistics, metropolitan area apartment prices rose ▲1.12% in January ▲1.71% in February ▲1.40% in March ▲1.33% in April ▲1.21% in May, marking over 1% increase for five consecutive months, with a cumulative rise of 6.95%. This is the first time since the Real Estate Board began related statistics in 2003 that prices have risen over 1% for five consecutive months.

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