[Asia Economy Reporter Kim Hye-min] The Seoul mayoral by-election scheduled for April 7 is now 53 days away as of the 14th. Among the pledges put forward by the preliminary candidates from both ruling and opposition parties, real estate policies are particularly eye-catching. This is because the soaring housing prices in Seoul over the past one to two years have significantly impacted the lives of voters across all generations.
In fact, a public opinion poll released by Ipsos on the 11th showed that 28.5% of Seoul voters cited real estate measures as their criterion for choosing a candidate. In a Realmeter survey on the 10th, 40% selected real estate stabilization as the top issue facing Seoul.
Seoul mayoral candidates have especially emphasized real estate pledges, and here is a summary of the major candidates' real estate policies.
◆ Ruling Party’s Woo Sang-ho and Park Young-sun also focus on supply... Aligning with the government through public-led housing = Woo Sang-ho, the Democratic Party candidate, promised to supply 160,000 public housing units. His plan includes creating artificial land over Olympic-daero and Gangbyeonbuk-ro and undergrounding the above-ground sections of Seoul Subway Line 1 to secure housing sites.
The public housing created through this plan will be supplied as follows: ▲10-pyeong units as 10-year public rental housing for youth ▲20-pyeong units as 20-year public jeonse (long-term lease) housing for newlyweds ▲30-pyeong units as 30-year public owner-occupied housing for low-income households without homes. The estimated required budget is about 6 trillion won.
He also announced plans to relax floor area ratio (FAR) regulations in station areas to promote high-density development, aligning with the government's recent policy to ease FAR up to 700%.
Candidate Park Young-sun pledged to supply 300,000 public sale housing units through urban redesign. Her plan includes undergrounding the road from the National Assembly to East Yeouido, undergrounding the Gyeongbu Expressway, and utilizing city-owned and national land to secure space. About half of the area will be turned into parks, and the remaining land will be used to supply housing such as single-person household hotels and apartments.
The public housing created will be supplied at half price through a land leasehold system. In this system, the land is leased while the building portion is owned by the contract holder, making the price more affordable since the land cost is not borne. Park said, "Since the land created by undergrounding roads is owned by the state or city, the land leasehold system is possible."
Both Woo and Park focus on supplying public housing by utilizing public land. However, their positions differ regarding private-led reconstruction and redevelopment.
Park said that reconstruction in the Gangnam area is necessary and that private-led redevelopment and reconstruction should be partially allowed. She suggested increasing public interest by having the city build community spaces such as libraries nearby, while the housing associations open apartment community spaces to the public. On the other hand, Woo said redevelopment and reconstruction would be promoted mainly in underdeveloped areas like Gangbuk, and that Gangnam reconstruction would be carefully reviewed in terms of development profit recovery and measures against the jeonse (long-term lease) shortage.
◆ Opposition, expanding supply scale further... Focus on private-led initiatives and deregulation = Ahn Cheol-soo, the People’s Party candidate, announced plans to supply 746,000 housing units over five years. His emphasis is on utilizing both public and private sectors.
Specifically, he plans to supply ▲100,000 rental homes for newlyweds and youth ▲400,000 homes for the 30-40 and 50-60 age groups ▲300,000 units through redevelopment, reconstruction, and remodeling projects.
Youth rental housing will be secured by utilizing city-owned idle spaces, old public office sites, and creating housing sites by undergrounding national and metropolitan railways. Housing for the 30-60 age groups will be supplied by developing station areas, semi-industrial zones, city-owned idle land, greenbelt areas, and public institution relocation sites, while actively encouraging redevelopment and reconstruction. He said redevelopment and reconstruction would be promoted through private-led or private joint development methods.
Ahn said, "Reconstruction projects subject to the excess profit recovery system will be revitalized by increasing floor area ratios, and redevelopment projects not subject to the system will raise floor area ratios through resident agreements while securing an appropriate level of public contribution to ensure public interest, social value, and profitability simultaneously."
Na Kyung-won, the People Power Party candidate, announced plans to supply 700,000 housing units over ten years. Specifically, she plans to supply 400,000 units by the private sector, 200,000 public rental units, and 100,000 units for youth and newlyweds. Among these, housing for youth and newlyweds will be developed as half-price apartments at about 10 million won per pyeong using land leasehold and other methods.
Na’s plan is to secure private-led supply through deregulation of redevelopment and reconstruction. She intends to relax or remove uniform floor limits and speed up the process with one-stop reviews. Additionally, she proposed ▲50% reduction in property tax for one-home owners ▲reduction in comprehensive real estate tax for long-term holders ▲raising the capital gains tax threshold from 900 million won to 1.2 billion won.
Oh Se-hoon, also from the People Power Party, announced plans to supply 360,000 housing units over five years. He plans to supply 185,000 units through revitalizing redevelopment and reconstruction, 70,000 units as win-win housing where public institutions rent private land to build housing, and 30,000 units through the introduction of the Moa Housing system, which aggregates multiple houses into urban-style townhouses.
He explained that redevelopment and reconstruction would be promoted by relaxing floor area ratio and height regulations to encourage private-led projects. Specifically, he plans to abolish the seven-story limit in the second-class general residential areas unique to Seoul and raise the floor area ratios in residential areas that are currently 30-100% lower than national standards. Particularly, for apartments along the Han River, he plans to relax the 35-story height limit to 50 stories to increase housing supply.
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