The Democratic Party of Korea on the 21st launched a task force (TF) to stabilize the housing market as a follow-up to the "10·15 real estate measures." As criticism mounted over regulation-centered, high-intensity real estate measures, the ruling party moved to draw up detailed plans for housing supply by the end of the year.
Policy Committee Chair Han Jeong-ae of the Democratic Party gave a briefing at the National Assembly on the afternoon of the day, outlining the roster for the housing market stabilization TF and follow-up measures. The TF will be led by Director General Han, and will include Representatives Lee Hae-sik (Public Administration and Security Committee), Jeong Tae-ho and Kim Young-hwan (Strategy and Finance Committee), Park Sang-hyuk (National Policy Committee), and Bok Gi-wang, Cheon Jun-ho, and An Tae-jun (Land Infrastructure and Transport Committee), for a total of seven participants. The list is set to receive final approval at the party's supreme council meeting on the 22nd.
Han said at the briefing that the "10·15 real estate measures" were an unavoidable choice for market stability and economic growth. Han said, "In the meantime, due to soaring home prices and a real estate bubble, it has become increasingly distant and difficult for middle-class ordinary people and young people to buy a home," adding, "Since the Lee Jae-myung administration took office, we have repeatedly said that the economy can revive only if the flow of money goes not into real estate but into industry and jobs."
Han added, "According to the party's own survey, contrary to the opposition's claims and media concerns, the public says the government should play an active role in stabilizing home prices," and "when home prices rise, public opinion that the government should stabilize them is more than twice as high as the view that the market should be left alone."
Han also explained that the latest measures have nothing to do with the majority of actual housing demanders. Han said, "In Seoul, more than 70% of all transaction volume involves dwellings priced at 1.5 billion won or less, and for these dwellings, the current loan limit (600 million won) remains in place," adding, "We did not touch at all the policy mortgage targets such as newlyweds or first-time homebuyers."
Addressing criticism that the measures favor cash-rich buyers, Han said, "With the obligation to transfer within six months and to reside for two years, we can impose a certain level of control," adding, "Even with ample cash, if there is no actual residency, purchasing dwellings effectively becomes impossible—a more difficult situation."
Han also outlined specific follow-up steps. Han said, "By December, we will prepare detailed plans related to housing supply, including specific supply plans by city, county, and district," adding, "With the public sector leading, we will accelerate housing supply, and in parallel we will support speeding up maintenance projects such as redevelopment and reconstruction being pursued by the private sector by simplifying procedures."
Separate from activating maintenance projects included in the Sept. 7 measures, the plan is to accelerate the handling of various housing supply-related bills. Han said, "Until now, the public sector led by preparing only the land while the private sector handled sales, and in doing so there were situations where sales prices went up," adding, "If institutions like LH, SH, and GH that developed the sites can implement projects directly, I believe more dwellings of good quality at reasonable prices can be supplied."
Han cited the third round of new towns as an example. Han said, "The third new towns are still not sorted out, and in cases where the private sector, not LH, is in charge, there are cases where, even after obtaining permits, projects are not pushed forward while watching the situation," adding, "We are considering a method of retrieving all such projects and having LH immediately carry out construction." Han said, "If LH proceeds together, I believe supply can occur quickly," adding, "We will also reduce areas set aside for commercial districts and convert them into housing sites."
Han said that about 20 pieces of legislation are needed as follow-up to the Oct. 15 real estate measures. For the urban public housing complex project under what is called the Special Act on Public Housing, the plan is to abolish the sunset clause and expand the scope of integrated deliberations. In addition, a Special Act on Urban Regeneration Promotion is being prepared to accelerate reconstruction and other regeneration-related projects. Han explained, "It includes simplifying the procedures for establishing regeneration promotion plans and providing financial support to residents."
In addition, for the Urban and Residential Environment Improvement Act, procedures will be simplified, and the Land and Housing Corporation Act will be revised to support project implementation by the Korea Land & Housing Corporation (LH), the Seoul Housing and Urban Development Corporation (SH), and the Gyeonggi Housing & Urban Development Corporation (GH). For the complex development of aging public office buildings included in the Sept. 7 measures, the plan is to ensure by early next year that there are no hurdles to pushing projects forward. A bill to provide incentives for modular dwellings will also have a draft prepared by early next year.
Separately from housing supply measures, Han drew a line, saying increases in holding taxes are not under review yet. Han said, "It hasn't even been a week since the Oct. 15 measures were announced, and the implementation of the land permit system is only on day two," adding, "At first it comes as a surprise and a shock, but more time is needed to digest it, and we believe we should watch until the end of the year. We are not considering or reviewing any follow-up tax measures at all right now."