Byeon Chang-heum: "Expanding the Real Estate Market Illegal Activities Response Team... Rent Ceiling System Is Premature"

Minister of Land, Infrastructure and Transport nominee Byeon Chang-heum is attending the confirmation hearing held at the National Assembly on the 23rd, responding to questions from lawmakers. Photo by Yoon Dong-joo doso7@

[Asia Economy Reporter Lee Chun-hee] Byeon Chang-heum, the nominee for Minister of Land, Infrastructure and Transport, announced plans to expand the current response team if the launch of the Real Estate Transaction Analysis Institute is not completed before the scheduled disbandment of the Real Estate Market Illegal Activities Response Team in February next year. He expressed a reserved stance on the introduction of a rent ceiling system for new lease contracts, citing insufficient related data.

At the confirmation hearing for the Minister of Land, Infrastructure and Transport held at the National Assembly on the 23rd, Byeon said, "There is a Real Estate Market Illegal Activities Response Team organized and operating within the Ministry of Land, Infrastructure and Transport, but it will be disbanded by mid-February next year." In response to a question from Jin Seong-jun, a member of the Democratic Party of Korea, asking, "What will you do if the Real Estate Transaction Analysis Institute is not launched before then?" he replied, "I believe it is necessary to urgently deploy the existing organization on a larger scale until the bill passes to visibly suppress suspicious and speculative cases."

Currently, the Illegal Activities Response Team within the Ministry is conducting intensive investigations into abnormal transactions by analyzing real estate actual transaction data, funding plans, investigating real estate market crimes, and collecting and analyzing information on illegal activities related to real estate.

However, as the Illegal Activities Response Team is set to be disbanded in February next year, Representative Jin introduced a bill last month to establish the Real Estate Transaction Analysis Institute as a control tower for responding to abnormal transactions and illegal activities in the real estate market. The bill is titled the "Act on Real Estate Transactions and Real Estate Service Industry."

Jinseongjun, Member of the Democratic Party of Korea Photo by Yonhap News

The bill specifies the roles of the Real Estate Transaction Analysis Institute, including ▲ analyzing violations of real estate-related laws among reported real estate transactions and investigating reported details ▲ managing and analyzing policy-related information ▲ cooperating with other investigative agencies on real estate crimes. It also grants the institute the authority to request business registration information and tax information from relevant administrative agencies, as well as financial transaction and credit information from financial institutions for investigations.

However, this bill is still pending in the National Assembly's standing committee. If the law does not pass the plenary session before the disbandment of the response team, the government's intensive actual transaction investigations will face a temporary gap. In response, nominee Byeon stated, "Currently, collective investment activities are frequently occurring in local areas, causing significant instability in local housing markets," and revealed plans to expand and urgently deploy the response team to suppress these activities.

Meanwhile, Byeon expressed that it is premature to introduce a rent ceiling system. He responded to Representative Jin's claim that the rent ceiling system should be introduced, noting that "while the effect of the revised Lease Protection Act is evident with 70% of lease contracts renewed using the right to request contract renewal, the prices of new lease contracts continue to rise," saying it is still difficult to implement.

Byeon emphasized, "To apply a ceiling to new leases, there must be an existing amount," highlighting the need to activate lease reporting and accumulate related data first. He stated, "Since this infrastructure is not yet in place, it is not yet determined what the baseline will be and how much the rent can be limited to increase beyond that," expressing a reserved stance that further review is necessary.