President Moon Intervenes Directly... But Both 2030 and 4050 Age Groups Are 'Boiling'

Soaring House Prices, Tight Loan Restrictions... Fundamental Measures Needed Over Taxes
Special Supply Benefits Only a Few... Must Give Hope That 'Opportunity Will Come to Me Too' If Waiting
"Is Korea Only Youth?" Criticism Arises Over Generation Conflict

Archive photo / Photo by Mun Ho-nam munonam@

[Asia Economy Reporters Yuri Kim and Donghyun Choi] Despite President Moon Jae-in personally stepping in amid growing public criticism of failed real estate policies, critical voices seem to be increasing. Genuine buyers, whose dreams of owning a home have become more distant, are responding that the government cannot even properly identify the causes of policy failures and is only focused on appeasing public opinion.

On the 2nd, when news broke that President Moon instructed Minister of Land, Infrastructure and Transport Kim Hyun-mi to expand subscription opportunities for newlyweds and young people, online reactions included comments such as, "Loan access has already been tightened due to soaring house prices, but they are just trying to show off by slightly reducing taxes." The argument is that with soaring house prices and loan access completely blocked, increasing subscription opportunities will not help anyone buy a home. Mr. Lee, a worker in his 40s, pointed out, "Even if the system is revised, dual-income households in their 30s and 40s generally do not fall within the benefit category and are still 'policy regulation targets,' so it will be difficult to change their mindset."

Resistance from middle-aged and older generations is also significant. As house prices surged, they had pinned their hopes on new apartment subscription opportunities, but they are dissatisfied that increasing supply for youth and newlyweds relatively reduces their share. In fact, competition for apartment subscriptions in Seoul is becoming increasingly fierce. According to Real House, a specialized apartment subscription evaluation company, the average competition ratio for first-priority apartment subscriptions in Seoul from May 2017, when the Moon Jae-in administration began, to December 2019 was 23.0 to 1. This is about 1.8 times higher than the 13.3 to 1 ratio during the Park Geun-hye administration. Especially, owners of mid- to low-priced homes on the outskirts of the metropolitan area say, "The ladder has been completely cut off." Mr. Jung, in his 50s, raised his voice, saying, "Because I own one inexpensive house, not only subscriptions but even loans have been blocked, while the government is only increasing benefits for those in their 20s and 30s. Are only young people citizens?"

Professor Kwon Dae-jung of Myongji University Graduate School of Real Estate said, "If the special supply for first-time homebuyers, which currently accounts for 20% of public housing supply, is expanded to the private sector, resistance from middle-aged and older generations is inevitable," adding, "Since expanding supply is not easy, the policy direction should focus on easing loan regulations for genuine buyers."