Candidate Park Sang-woo: "Actual Residence Requirement Should Be Abolished... Gap Investment Is Part of the Housing Ladder"

Park Sang-woo, the nominee for Minister of Land, Infrastructure and Transport, emphasized the necessity of abolishing the mandatory residence requirement for houses subject to the price ceiling system and expressed the view that so-called 'gap investment,' buying a house with a jeonse deposit, is part of the housing ladder.

Park Sang-woo, nominee for Minister of Land, Infrastructure and Transport, is responding to questions from lawmakers at the confirmation hearing held at the National Assembly on the 20th. / Photo by Yonhap News

On the afternoon of the 20th, during the confirmation hearing of the National Assembly Land, Infrastructure and Transport Committee, when Kim Jeong-jae, a member of the People Power Party, asked about the need to abolish the mandatory residence requirement for houses subject to the price ceiling system, Park said, "The mandatory residence requirement was to prevent speculation in an overheated market," adding, "The market situation is not like that now. Medicine taken in winter should be withdrawn quickly in summer."

He continued, "Some say that buying a house with a jeonse deposit is speculation, but I think it is an important part of the housing ladder," and said, "When you cannot buy a house outright from the beginning, renting with jeonse and then saving money to move in is part of the housing ladder in our society."

The mandatory residence requirement is a regulation that requires occupants of houses subject to the price ceiling system to reside directly for 2 to 5 years from the initial move-in date. It was introduced in 2021 to block speculative demand and supply housing focused on actual demand.

However, there have been criticisms that it hinders recipients from choosing suitable residences or renting out due to difficulties in securing the remaining payment. Moreover, as the sales market froze in the second half of last year, the government announced plans in January this year to ease resale restrictions and abolish the mandatory residence requirement. Related amendments to the Housing Act and its enforcement decree were proposed in February but remain pending in the National Assembly amid opposition concerns that abolishing the mandatory residence requirement could encourage gap investment.

The Land, Infrastructure and Transport Committee will hold the last Land Act Review Subcommittee of the year on the 21st to discuss the bill to abolish the mandatory residence requirement. If the bill fails to pass in this extraordinary session, discussions are likely to be postponed until after the general election in April next year.

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