"Demand Suppression, Strict Crackdown on Speculation Focused but Failed to Predict Demand"
Overlooked Increase in Single-Person Households
"One Person Owns 760 Units... Clearly Policy Missed Expectations, Must Correct Even Now"
[Asia Economy Reporter Oh Ju-yeon] Lee Nak-yeon, former leader of the Democratic Party and a presidential candidate, acknowledged the failure of the Moon Jae-in administration's real estate policy, stating that "demand was not predicted." This is the first time Lee has publicly criticized the government's real estate policy since stepping down as party leader and launching his presidential bid.
On the morning of the 26th, Lee attended a presidential candidate debate hosted by the Korea Newspaper and Broadcasting Editors Association at the Press Center on Sejong-daero, Seoul, where he analyzed the real estate policy failure by saying, "The government's real estate measures so far have mostly aimed at stabilizing the real estate market, so the focus was placed on 'demand suppression' and 'strict crackdown on speculation.'"
The debate lasted over two hours, with 14 editors-in-chief and editorial writers from media outlets questioning Lee on politics, economy, society, diplomacy and security, regional balance, and other areas. Regarding economic policy, he emphasized efforts to enable businesspeople to feel pride and fulfillment, and to resolve job and housing issues. Particularly on the real estate issue, he repeatedly said that "we did not predict" and continued with strong criticism and reflection, stating "anyone can see the policy was wrong." He also admitted that the increase in single-person households was overlooked.
Lee said, "In Seoul, the number of households is increasing due to the rise in single-person households," adding, "There are also young people moving from non-capital regions to the capital area, but we did not sufficiently predict this increase." He further explained, "The period of population outflow toward the capital area exactly coincides with the period of rising real estate prices," and stated, "We failed to prepare and predict this. We must prepare for the increase in single-person households going forward."
Additionally, Lee mentioned that "although the policy had good intentions, there were cases where it went astray," referring to excessive benefits for housing rental business operators.
He said, "The benefits for rental business operators were intended to protect tenants, but the result was that properties were withheld from the market and the benefits became a tax haven," emphasizing, "The situation where one person owns 760 properties is clearly a policy that missed expectations. It must be corrected even now."
Regarding the easing of real estate regulations such as the comprehensive real estate tax, he said, "Final discussions between the party and government or within the party will take place soon," adding, "There is a need to raise the threshold for easing property tax." He also stated, "Regarding the comprehensive real estate tax, considering the perspective of tax justice and tax resistance due to the rapid increase in tax burden, it is necessary to carefully review how much the actual burden has increased and consider compromise measures such as buffering the speed of official land price realization."
© The Asia Business Daily(www.asiae.co.kr). All rights reserved.
