Seoul's "real estate public sentiment" is roiling ahead of the local elections. From tax issues such as narrowing the long-term holding special deduction and raising property taxes to supply issues like redevelopment and reconstruction, a range of real estate topics is on people's lips. Some forecast that the outcome between Democratic Party of Korea candidate Chong Won-o and People Power Party candidate Oh Se-hoon could turn Seoul's real estate market 180 degrees.
ChosunBiz on the 18th visited apartment complexes, brokerages, and redevelopment and reconstruction sites in Gangnam, Gangdong, Nowon, Songpa, and Yongsan in Seoul to take the pulse of "real estate public sentiment." Citizens and real estate workers encountered there showed strong interest in the Seoul mayoral election. Political circles also cite real estate policy as a key variable that will decide the race.
◇ "Taxes will rise," skeptical views… some say "Gangnam apartment prices are too much"
A licensed broker surnamed Han (38) whom we met at Helio City in Songpa District, Seoul, said of the government's real estate policy stance, "It's like pouring fuel on an area where the People Power Party already has high support." Helio City, a large complex of 9,510 households, began move-ins in 2019. He said about 30% are non-owner-occupied. If the government narrows the long-term holding special deduction to "actual residents," non-resident single-homeowners are likely to take a direct hit.
Han said, "One older person is currently based in Pohang and decided to give up life in the provinces and move up," adding, "It's fortunate if, like that person, you can give up living in the provinces, but others will have no choice but to sell under duress."
A broker surnamed Lee (53), a woman who works at Olympic Park Foreon in Gangdong District, Seoul, also said, "The narrowing of the long-term holding special deduction becoming an issue before the election will be a bad move for the Democratic Party of Korea," adding, "Loan regulations have cut off people at the arms and legs. Jeonse has disappeared, monthly rents are rising, and people are ultimately being pushed to the outskirts." A licensed broker surnamed Lee (52), a woman we met in Banpo-dong, Seocho District, Seoul, mentioned the property tax hikes and said, "It's a problem to demand more taxes when someone has worked all their life to buy one apartment to live in."
There were also views agreeing with the real estate policy direction of the Lee Jae-myung administration. A man in his 60s surnamed Park, a former member of the Olympic Park Foreon association, said, "Narrowing the long-term holding special deduction is necessary, and President Lee Jae-myung seems to have a good overall grasp of the real estate market," adding, "The gap in apartment prices between Gangnam in Seoul and the provinces is far too great. I think the Seoul mayor will 100% switch to the Democratic Party."
◇ Maintenance projects and rental dwellings… focus on supply measures
Both Democratic Party of Korea candidate Chong Won-o and People Power Party candidate Oh Se-hoon are emphasizing redevelopment and reconstruction maintenance projects. Chong is proposing easing the jeonse and monthly-rent crunch through purchase-based rentals, while Oh is additionally presenting "targeted supply" via financial support.
A licensed broker surnamed Park (70), a man who works in Nowon District, Seoul, said regarding Nowon being designated under the land transaction permit system, "I don't know why (the government) is regulating Nowon at all. People who invested on the outskirts expecting redevelopment all got burned," adding, "Even with rental dwellings, due to inflation and rising apartment prices, buying a home is impossible."
Residents and brokers at Gwangjang Geukdong Apartment and Jayang District 7 in Gwangjin District, which were selected as redevelopment and reconstruction sites under the fast-track planning, a flagship project of candidate Oh Se-hoon, also reacted that "for maintenance projects to proceed smoothly, continuity in city administration would be better, wouldn't it." By contrast, in the online community of Eungbong Daerim 1st Complex in Seongdong District, which is pursuing reconstruction, there were opinions to the effect that "even if Chong Won-o becomes mayor, since he served as Seongdong District chief, he could be positive on reconstruction."
In Yongsan District, Seoul, where a war of words erupted over candidate Chong Won-o's comment about supplying 10,000 dwellings in the Yongsan International Business District, a licensed broker surnamed Jung (45), a man, said, "I doubt 10,000 units in Yongsan can be supplied within President Lee Jae-myung's term. It's unrealistic," adding, "Even just attracting corporations to the international business district will increase traffic, and if you add more dwelling supply there, it will become as congested as Gangnam."
Views on Chong in the maintenance industry are split. A maintenance-industry official said, "Honestly, if a Democratic Party candidate wins, it feels like a 'second Park Won-soon' era will unfold," adding, "Under the former mayor Park, maintenance projects all stopped and only remodeling took place. Oh Se-hoon definitely pushes maintenance projects."
On the other hand, another official said, "From the Lee Jae-myung administration's standpoint, stable supply is important, so at least for maintenance projects I think the pace will pick up," adding, "We need a Democratic Party of Korea Seoul mayor so that the city and the government can work in sync." The Seoul City Federation of Urban Maintenance Project Associations and the Seoul City Remodeling Association Council are scheduled to declare support for Chong on the day.
Candidates Chong Won-o and Oh Se-hoon are locked in a neck-and-neck race within the margin of error. A survey by polling institute Metrics commissioned by The Chosun Ilbo of 800 Seoul voters on the 16th-17th found Chong at 40% and Oh at 37%.
The poll was conducted via telephone interviews using virtual mobile numbers provided by the three telecom companies. The margin of error is ±3.5 percentage points at a 95% confidence level, and the response rate is 13.6%. For details, refer to the website of the National Election Survey Deliberation Commission.