[Takryucheongron] Sell Your House, Only the People?

Seo Hwion, Secretary of the Citizens' Coalition for Economic Justice

The promise by the Blue House and the Democratic Party of Korea to sell off multiple homes owned by public officials reverts to the situation at the end of last year. On December 16, last year, Presidential Secretary No Young-min recommended that senior Blue House officials at grade 1 or higher who owned two or more houses in the metropolitan area dispose of all but one residence. Two days later, then-Democratic Party floor leader Lee In-young proposed a 'disposal pledge for non-residential properties' to candidates running under the Democratic Party banner in the 21st general election, stating, "We will not use houses as a means of wealth accumulation."

However, six months after the recommendation, neither the Blue House nor the Democratic Party disclosed the status of the pledge or the implementation of property disposals by multiple homeowners. In response, the civic group Citizens' Coalition for Economic Justice investigated and announced the status of multiple homeowners within the Blue House and the Democratic Party on the 1st and 7th of last month.

The investigation revealed that among 64 Blue House aides, 18 (28%) owned two or more houses.

Among them, eight senior officials owned two or more houses in the metropolitan area. An analysis of the price changes of apartments owned by these eight officials showed that the average price of one apartment in the metropolitan area rose from 1.18 billion KRW in May 2017 to 1.91 billion KRW this year, an average increase of 700 million KRW (62%) during the Moon Jae-in administration.

Among Democratic Party members of the National Assembly, 42 out of 180 (23%) were multiple homeowners, and among them, 21 owned two or more houses in regulated areas (speculative areas, speculative overheating districts, or adjustment target areas). An investigation into the apartment price changes of nine re-elected lawmakers among these 21 showed that the price of one apartment in regulated areas increased from 1 billion KRW in March 2016 to 1.5 billion KRW in June this year, an average increase of 500 million KRW (49%) during the 20th National Assembly.

Ultimately, the Blue House and the Democratic Party's recommendation to sell houses was revealed to be a move to avoid public criticism. On the contrary, it worsened public opinion. The public came to believe that the government had been essentially saying, "Please sell your houses, citizens, only you!"

As public opinion deteriorated, Secretary No reissued the recommendation on the 2nd of last month to Blue House aides to dispose of all but one residence. On the 31st of last month, as the deadline for the disposal recommendation approached, the Blue House announced that eight multiple-homeowning aides were undergoing the process of disposing of their properties. Once again, the promise by senior Blue House officials to dispose of houses has been postponed until August.

In August 2017, the Blue House urged multiple homeowners to sell their houses by April 2018. However, during that time, Blue House aides made enormous capital gains from the properties they owned.

The assets of Kim Jo-won, Senior Secretary to the President for Civil Affairs (who owns two houses), increased from 2.1 billion KRW in 2017 to 3.27 billion KRW in June this year, a rise of 1.17 billion KRW, while the assets of Yeo Hyun-ho, Secretary for National Public Relations (also owning two houses), increased from 1.35 billion KRW to 3.01 billion KRW during the same period, a rise of 1.66 billion KRW.

In his 2020 New Year's address, President Moon Jae-in said, "I will bring house prices back to the level at the time of my inauguration." If the president still has the will to fulfill this promise, he should replace the multiple-homeowning aides in the Blue House. Which citizen can trust housing stabilization policies promoted by senior public officials who own multiple homes?

The Moon Jae-in administration, while claiming to suppress speculative transactions, paradoxically introduced policies easing taxes and loan regulations for multiple homeowners, thereby encouraging speculation among them. This ultimately aligns with the reality where the ruling power profits from soaring house prices through capital gains.

Seo Hwi-won, Secretary, Citizens' Coalition for Economic Justice