The government said it will hold a real estate policy forum for three days starting on the 14th to discuss supply, finance, and tax policies across the board. The debate topics the government released that day include what the appropriate level of real estate holding tax should be and what price should count as a super high-priced dwellings subject to regulation.
The government real estate policy forum is being held at the suggestion of President Lee Jae-myung. The Ministry of Land, Infrastructure and Transport will hold a forum that day on the theme of supply of dwellings. On the 15th, the Financial Services Commission will follow with financial regulation as the theme, and on the 16th, the Ministry of Economy and Finance will debate real estate taxation. Policy officials, economists invited by the government, and members of the public are said to be taking part in the forum.
That day, the government released in a PPT the key issues to be discussed at the forum. At the forum on supply of dwellings hosted by the Ministry of Land, Infrastructure and Transport on the 14th, easing regulations to revitalize private redevelopment and reconstruction will be discussed. To stabilize real estate prices, supply needs to expand, and to that end, some argue that floor area ratio limits should be raised and loan regulations loosened to actively encourage redevelopment and reconstruction.
In addition, the forum is expected to discuss: ▲ using idle land in downtown areas such as the Yongsan International Business District ▲ easing finance and tax regulations on multi-homeowners to spur new supply of non-apartment dwellings ▲ making urban and building regulations more flexible ▲ the main actors for supplying private rental dwellings ▲ ways to disperse demand by transferring institutions in the greater Seoul area to the provinces.
At the Financial Services Commission forum on the 15th, whether to ease regulations on mortgage loans and jeonse loans to help end users such as young people without dwellings purchase dwellings will be discussed. The forum may also take up what criteria to use to judge "speculative" behavior regarding the government's stated plan to regulate "speculative nonresident one-home owners." In addition, regulation of relocation loans, which are subject to the same 40% loan-to-value (LTV) cap as mortgage loans, will be a point of contention.
On the 16th, the Ministry of Economy and Finance will hold a forum on real estate taxation. The appropriate level of the real estate holding tax, which combines the property tax and the comprehensive real estate tax, will be on the agenda. The forum will also discuss whether to differentiate tax burdens by region, such as the greater Seoul area vs. non-capital regions and regulated vs. non-regulated areas. In addition, differential taxation based on the number of dwellings or actual residence, tougher taxation on super high-priced dwellings, and the direction for overhauling the long-term holding special deduction will be topics of debate.
After the policy forums, the government plans to decide the main measures of real estate policy, including taxation, following a grand debate chaired by President Lee on the 23rd.