"House Prices with Taxes? Definitely Not a Solution"
"Yoon Seok-yeol Failed to Enforce Discipline and Only Wasted Time"
[Asia Economy Reporter Park Cheol-eung] Song Young-gil, a member of the Democratic Party and a candidate for the next party leadership, argued that LTV (Loan-to-Value ratio) and DTI (Debt-to-Income ratio) loan regulations should be boldly relaxed up to 90% when non-homeowners buy a house. He aims to make it possible to buy a house with only 5-10% of the house price.
On the 13th, Song appeared on CBS Radio's 'Kim Hyun-jung's News Show' and said, "The current real estate policy is to raise taxes when house prices go up, but from the perspective of the public and tenants, it looks like the state and homeowners are accomplices sharing the profits from rising house prices," adding, "44% of our country’s population are tenants, and 40% of homeowners also rent. 60% of people rent even though they own a home. Solving rising house prices just through taxes? That is absolutely not a solution."
He continued, "I want to create an era where anyone can buy their first home at the initial sale price with only 5% or 10% down," and said, "For first-time homebuyers who are non-homeowners, LTV and DTI should be relaxed to 90% so they can buy a house immediately."
Regarding real estate policy, he also said, "There were problems even between the party and the government." Song stated, "You need the capability to effectively lead and strong determination. For example, if you limit LTV and DTI to 40% or 60% for young people who want to own a house, buying a 1 billion won house means only 400 million won can be borrowed. Those without 600 million won cannot buy a house. Then, people with cash who do not rely on banks take everything through 'jubjub' (snatching up properties)," he explained.
He identified the cause of the by-election defeat as real estate issues. Song said, "There are various complex causes, but the core is the real estate policy," and pointed out, "Despite announcing 24 real estate measures, house prices rose, and people in their 20s and 30s couldn’t find homes and were all driven out. Those who own homes couldn’t sell them, leaving them stuck, which caused widespread dissatisfaction."
He said the so-called 'competent reform' was not achieved. He interpreted the same context regarding prosecution reform. Song said, "Prosecutorial power is a core position of the ruling party and government. The Prosecutor General we appointed," and added, "We appointed the Minister of Justice, so why couldn’t we manage and organize it effectively? That criticism is significant."
He continued, "When disciplinary action was taken against Yoon Seok-yeol, it failed midway due to procedural defects, right? Whether to discipline firmly or not, or to compromise, why couldn’t it be handled smoothly? People are struggling to make a living and suffering from COVID-19, yet time was wasted dragging things out," he said. He defined this as "a lack of ability to produce practical results."
Regarding the controversy following the statements of first-term lawmakers within the party, he said, "There are differences in opinions among each other. I plan to listen sufficiently, balance views, and build consensus."
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