Government Launches Real Estate Market Monitoring Task Force
Concerns Grow as Apartment Price Surge Spreads Beyond Gangnam
Officials Pledge to Stabilize Market and Address Speculative Demand
As the overheating trend in apartment prices that began in the Gangnam area of Seoul shows signs of spreading to other regions, the government has begun reviewing specific countermeasures.
On June 12, Lee Hyungil, the First Vice Minister and Acting Minister of Economy and Finance, convened a Real Estate Market Monitoring Task Force meeting to discuss the recent real estate market situation. Senior officials from the Ministry of Economy and Finance, the Ministry of Land, Infrastructure and Transport, the Financial Services Commission, and the Financial Supervisory Service attended the meeting. After first reviewing the inflation situation following his appointment, Lee also examined the real estate market in the afternoon. The Real Estate Market Monitoring Task Force, a consultative body launched last year, meets as needed whenever unusual trends such as market overheating are detected. This was the first meeting held since President Lee Jaemyung took office.
According to the Ministry of Land, Infrastructure and Transport, the participants reviewed market conditions and trends in household lending. They agreed that the situation in the Seoul real estate market is severe. According to the Korea Real Estate Board, the weekly increase in Seoul apartment sales prices rose by 0.26% compared to the previous week, marking the highest level in nine months.
Previously, in February and March of this year, prices surged during the process of lifting and then re-designating areas such as Gangnam as land transaction permit zones. The current trend is even hotter than it was at that time. The increase in household loans, which had slowed after rising by 5 trillion won from October to November last year, has recently accelerated again, with increases of 5.3 trillion won in April and 6 trillion won last month.
The industry believes that demand is surging ahead of the implementation of the third phase of the stress DSR (Debt Service Ratio) regulations, which will take effect next month. Although President Lee has pledged to expand housing supply, the lack of clear direction on real estate policy has also led to buying activity driven by anxiety. There is precedent for this: under the previous Democratic Party administration, a tilt toward regulation led to concerns about supply shortages and a sharp rise in housing prices.
The government stated, "We will prioritize the stabilization of housing for the public and, based on the principle of protecting genuine demand, will comprehensively review all available policy tools across ministries to ensure that speculative activity, market disruptions, or anxiety-driven excess demand do not undermine market stability."
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