At a Seoul real estate forum that ran for 100 minutes starting at 10 a.m. on the 6th, sharp criticism poured in against the current administration's real estate policies. Experts, licensed real estate agents, and citizens said in unison that the shake-up of the tax system could worsen the crunch in monthly and jeonse rentals. They also said the government should acknowledge that the private rental market is one pillar of supply and ease regulations to protect landlords.
◇ "'25 billion won in capital gains' President Lee, being driven to sell his home"
Kim Je-kyung, head of Toomy Real Estate Consulting, said, "Looking at the Aug. 3 tax overhaul plan, I thought Lee Jae-myung's administration's real estate policy was almost a failing grade," adding, "During Moon Jae-in's administration, at least long-term holders were left alone."
Referring to President Lee's sale of his Bundang apartment, he said, "The president also acquired it in 1993 and had 2.5 billion won in capital gains, but no one calls it speculation, because it was acquired long ago and he was the actual owner," adding, "But now others are being driven to sell by 2027 because their capital gains are large." He added, "Right now there's even talk of a '21st-century Goryeojang.'"
Lee Chang-mu, a professor of urban engineering at Hanyang University, said it was a policy that "went all in on" homeowners, pointing out it was "a structure that inevitably triggers anxiety for monthly and jeonse renters." Lee said, "To enjoy the job accessibility of core cities in major metropolitan areas, there must be monthly and jeonse rental dwellings where working young people can live, but they are being pushed out," adding, "Older adults are being pushed out, too, and in the end only the asset class can move into Seoul, which could spark a very serious social problem."
Jung Jae-hoon, a professor in the Department of Urban Planning and Real Estate at Dankook University, called the tax overhaul plan "like pouring oil on a fire." Jung said, "Regulations on land transaction permit zones have already caused a sharp drop in jeonse listings and an increase in rental expense," adding, "With more landlords opting to live in their homes, monthly and jeonse prices are bound to rise."
◇ "Jamsil jeonse deals 80→10… jeonse is lifting sale prices, too"
Licensed real estate agents on the front lines of the market voiced the greatest concern about the decline in monthly and jeonse listings. Park Jun, who has run a brokerage in Jamsil-dong, Songpa District, for 21 years, said, "Some areas of Seoul and Gyeonggi Province were designated land transaction permit zones, creating a self-occupancy requirement, so owners who used to rent are trying to move in themselves," adding, "Normally there are about 50 to 80 monthly and jeonse listings, but now it's down to 10 or fewer, and prices have risen a lot."
Kim Yong-hyeok, head of the Seoul Southern Chapter of the Korea Association of Realtors(KAR) and active in Gangseo District, said, "Monthly and jeonse listings in Seoul have dried up," adding, "Originally, 80% to 90% of brokerage transactions were monthly and jeonse, with the rest sales, but now it's the reverse, with only 10% to 20% monthly and jeonse transactions." He said, "With no listings, in the end people have to buy, and as purchase demand increases, sale prices also rise." He added, "If you keep tightening the screws on non-occupant single-home owners and multi-home owners, prices will inevitably keep rising and the real estate market will inevitably be distorted."
There were also calls to come up with solutions for a shaky housing ladder caused by a steep drop in non-apartment supply. Noh Hyang-nam, a licensed real estate agent who runs a brokerage in Cheonho-dong, Gangdong District, said, "In my area, there are many villas, detached dwellings, and multi-unit dwellings," proposing, "We need policies and tenant protection measures that can revive not only apartments but also the non-apartment rental market."
◇ "Private rentals are also one pillar of supply... regulations should be eased"
Park Hyun-ho, who identified as a two-dwelling owner in one household, said, "I have two small, older units worth less than 500 million won," emphasizing, "The government treats me like a multi-home speculator and a demon, but people like us serve as the capillaries of the market." He said, "We provide living space at relatively affordable prices to young workers and newlyweds who have to work in Seoul," adding, "If we are forced out of the market entirely by regulations, it will only tighten tenants' breathing room." He continued, "We need a rational system that allows end users and rental suppliers to coexist."
Cho Gang-tae, CEO of the shared housing startup "MANGROVE," said, "Public rentals alone cannot solve the problem," adding, "If laws, tax policy, and financial systems that can be applied to private corporations operating private rental housing are clarified, supply can happen immediately."
Seoul Mayor Oh Se-hoon wrote on his Facebook after the forum, "What weighed most heavily was the criticism that there are no practical measures for the monthly and jeonse rental market, which is directly tied to the lives of low-income people without homes, in the government's policies," adding, "I will compile every opinion raised today without leaving anything out and deliver them to the government." He also said, "We will clearly call for fixes to systems that fuel housing anxiety, and we will keep recommending improvements to regulations that block supply to the very end."