Lee Kwang-soo, head of Kwang-soo's Realty, long seen as a leading housing price bear, criticized the government and the ruling party's real estate response, saying home prices could surge again if the current situation continues. Lee is the figure whom President Lee Jae-myung directly asked for opinions in public and who recently gave a lecture to lawmakers from the Democratic Party of Korea.
According to the real estate industry on the 10th, Lee appeared on the YouTube channel "Choi Wook's Maebul Show" on the 7th and said, "If Korea keeps going like this, there could be a real estate price spike," adding, "The Democratic Party or the government's stance is extremely complacent."
He warned, "If this continues, home prices will keep rising, the real estate market will become chaotic, and that will grip the whole economy."
He also criticized the government for focusing on expanding long-term dwellings supply.
Lee said, "Their so-called countermeasures are basically, 'we'll increase dwellings supply in the long term,'" adding, "It's like saying let's farm the fields when a war has broken out right now." His point was that, rather than the direction of expanding supply itself, there is a lack of measures to address the immediate upward price pressure emerging in the market.
Lee cited the money supply in circulation, interest rates, and a shortage of dwellings supply in the greater Seoul area as key factors fueling rising home prices.
Referring to the rise in M2 (broad currency), he said, "The gravity that makes real estate prices keep rising is the money supply," explaining, "As money increases, the price of money falls and the price of goods inevitably rises."
He also pointed to the decline in move-in volumes for apartments in the capital region as a factor adding upward pressure on home prices.
Lee said, "The volume of apartment move-ins in the capital region keeps shrinking," adding, "So jeonse and monthly rents are under pressure, and demand is growing to 'take out loans and buy a home.'"
He added, "This situation will continue until 2028," emphasizing, "If nothing is done, the market will simply be exposed to it."
He also offered a different view on President Lee's mention on the 30th of the possibility of falling home prices due to high interest rates.
Lee explained that, considering the inflation rate, real interest rates are low, implying that raising rates alone is unlikely to sufficiently curb real estate purchase demand. He said, "Even if you raise rates, prices rise even more, so the real interest rate is negative."
He also showed fatigue with continuing to comment on government policy.
When the host asked for alternatives for the real estate market, Lee said, "I'm really exhausted. I'm unwell. I decided not to talk about real estate," adding, "It's painful to talk about this. I'll just talk about semiconductor stocks going up."
Lee's remarks are drawing attention because he has been classified as a leading housing price bear and, since the current administration took office, he has been an expert from whom President Lee and the Democratic Party of Korea have publicly sought opinions.
At a national debate on real estate held in July, President Lee referred to him and said, "I watch Lee Kwang-soo teacher a lot, so please, Mr. Lee Kwang-soo, offer a critique," directly asking for his opinion.
On the 1st, Lee also gave a lecture on the real estate market and policy to about 20 lawmakers at the invitation of the Democratic Party of Korea.