Real Estate Public Sentiment Fueled by 'LH Speculation'... "Cancel the 3rd New Town" Petition to the Blue House

LH Employees, Land Speculation Allegations Spread Widely
"Words Like Justice and Fairness Are Bitter," Blue House Petition
Hong Nam-ki on LH Speculation Allegations: "Deeply Saddened... Will Prepare Measures to Prevent Recurrence"

Pedestrians are passing in front of the headquarters of Korea Land and Housing Corporation (LH) in Chungmugong-dong, Jinju-si, Gyeongnam. [Image source=Yonhap News]

[Asia Economy Reporter Heo Midam] "I trusted the government and waited, but I feel empty.", "Only those who work hard end up being fools."

As suspicions of land speculation by employees of the Korea Land and Housing Corporation (LH) have surfaced in the Gwangmyeong and Siheung districts of Gyeonggi Province, designated as the 3rd New Towns by the Moon Jae-in administration, public sentiment regarding real estate is boiling over. Following a nationwide surge in real estate prices under this government and growing allegations of speculation by public officials, citizens are raising doubts about the fairness of real estate policies and continuing their criticism.

In particular, recently, petitions demanding the cancellation of the designation of the 3rd New Towns have been posted, intensifying the voices of criticism. The government has stated it will prepare thorough measures to prevent such incidents from happening again.

Recently, on the Blue House's national petition board, petitions condemning the land speculation allegations by LH employees in the new towns have been posted one after another.

In a petition titled "Strongly Request a National Audit on LH Executives' Land Speculation Allegations in Gwangmyeong and Siheung New Towns," posted on the 2nd, the petitioner expressed frustration, saying, "I believed in the war against speculation, looking only at the 3rd New Towns and the homeless, but I am truly disheartened," and "I couldn't believe my eyes when I saw articles reporting that about ten people invested 10 billion won."

They continued, "The words justice and fairness taste bitter," and emphasized, "I hope this practice is eradicated root and branch this time. I request an unreserved investigation and a national audit."

There was even a petition asking for the cancellation of the 3rd New Town designation. Another petitioner, on the 5th, posted a petition titled "Please Withdraw the 3rd New Town," criticizing, "Please withdraw the 3rd New Town designation led by LH. Should we entrust the fish to the cat?" As of 10 a.m. on the 8th, this petition had garnered about 24,480 signatures.

Earlier, the Lawyers for a Democratic Society (Minbyun) and the People's Solidarity for Participatory Democracy held a press conference on the 2nd, raising suspicions that about ten LH employees engaged in pre-speculation worth approximately 10 billion won before the announcement of the designation of the Gwangmyeong and Siheung 3rd New Towns.

Through analysis of land registers, they revealed that from April 2018 to June last year, 14 LH employees and their spouses and families purchased a total of 10 plots measuring 23,028㎡ (about 7,000 pyeong) for around 10 billion won. Notably, this period coincided with the tenure of Minister of Land, Infrastructure and Transport Byeon Changheum as LH president (April 2019 to December 2020), which intensified the controversy.

Recently, on the Blue House National Petition Board, petitions condemning the 'suspected land speculation by LH employees in new towns' have been posted one after another. Photo by Blue House National Petition Board capture.

Meanwhile, Minister Byeon recently sparked controversy by making remarks that seemed to defend LH employees' land speculation in Gwangmyeong and Siheung.

On the 4th, Minister Byeon said, "It doesn't seem that they bought the land knowing development information in advance. They bought it thinking the new town development wouldn't happen, but suddenly it was designated as a new town," and "Buying land in a new town that will be fully expropriated is foolish. Expropriation is done at market value, so there is no merit," causing an uproar. Eventually, Minister Byeon apologized, saying, "It was my fault that my remarks appeared to defend LH employees' speculative actions."

Given this situation, anger toward LH seems to be spreading into distrust of the government. Public enterprise employees, who should cooperate with real estate policies, not only led speculation by abusing their duties, but with the Minister of Land, Infrastructure and Transport's supportive remarks, people have lost trust in the government's real estate policies.

Kim (31), an office worker who identified as homeless, said, "I trusted the government's words about 'controlling house prices' and waited, but real estate prices keep rising. It's now impossible to own a home just by saving my salary," and raised his voice, "While citizens are suffering like this, if public enterprise employees exploited internal information for speculation, isn't this a mockery of the people?"

He added, "This incident has destroyed trust in the government's real estate policies. I feel anger beyond emptiness," and criticized, "If these allegations are true, they must not be lightly punished."

Minister of Land, Infrastructure and Transport Byeon Chang-heum is leaving the press conference room after delivering the announcement titled 'A Message to the People Regarding Real Estate' at the Government Seoul Office in Jongno-gu, Seoul on the 7th. Photo by Yoon Dong-joo doso7@

Especially since President Moon Jae-in has repeatedly emphasized suppressing speculation to stabilize the real estate market since his inauguration, citizens' anger is growing stronger. In his New Year's address last year, President Moon stressed, "The government's will for market stability, protection of real demanders, and suppression of speculation is firm," and "We will never lose the war against real estate speculation."

On real estate communities and elsewhere, calls for institutional measures to prevent recurrence are being made. One netizen said, "If public enterprise employees or public officials who have prior knowledge of real estate information speculate under borrowed names or by other means, no one will be able to stop it," and urged, "I hope the Gwangmyeong and Siheung New Towns do not become a feast for public enterprise employees or related public officials' families and acquaintances," calling for prevention of recurrence.

Meanwhile, Hong Nam-ki, Deputy Prime Minister and Minister of Economy and Finance, held a meeting with related ministers at the Government Seoul Office the day before and apologized, saying, "I am deeply saddened that an unfortunate incident occurred at the most fair and self-disciplined public institution executing recent real estate policies on the ground, the Korea Land and Housing Corporation (LH), regarding land speculation allegations by its executives and employees."

He added, "Taking this incident as an opportunity, we will systematically prepare not only measures to prevent deviation but also fundamental measures to prevent recurrence," and announced plans to establish recurrence prevention measures such as a real estate registration system.