[Editorial] Real Estate Grand Forum Should Not Be a Mere Formality for Raising Taxes

A major forum on real estate policy will be held on the 23rd, chaired by President Lee Jae Myung. The purpose is to hear public views directly on key issues such as supply, finance, and taxation, and reflect them in policy decisions.
The issues shared by the President include appropriate holding taxes, differentiated holding taxes for owner-occupied single homes, non-owner-occupied homes, and multiple-home owners, as well as the relationship between holding taxes and transaction taxes. Supply and financial policy are also on the agenda, but it is clear that the main topic is the government's plan to raise holding taxes. The opposition party has criticized the forum as a discussion with a predetermined answer, while Seoul Metropolitan Government Mayor Oh Se-hoon has responded positively.
In fact, the timing of this forum is somewhat late. The sharp rise in housing prices that began in Seoul started early in the Lee Jae Myung administration. It would have been better to hold a nationwide forum and gather public opinion when the surge first became visible. Even so, there is no particular reason to oppose hearing views directly from various sectors, especially from ordinary people who are actual homebuyers.
Real estate is such a difficult policy issue that no administration has found a clear answer. The Park Geun-hye administration also struggled with a sluggish property market. Under the Moon administration, 28 measures were introduced, but they were heavily focused on regulation. The result of repeated regulation was the opposite of what was intended. The Lee Jae Myung administration has also announced several measures, but they have failed to gain traction in the market.
The tool that now appears to be the final card is regulation in the form of higher holding taxes, but resistance is likely to be strong, suggesting that the government is still weighing its options. Holding tax increases are expected to be the most frequently mentioned issue at this forum, yet it will not be easy to reach a clear conclusion on that point either.
In the end, the debate will split into supporters and opponents of higher holding taxes, and the government will have to choose one side. Rather than simply adopting one camp's view, the government should first consider whether the policy will help stabilize housing prices overall, while also taking into account the position of taxpayers who own homes.
The most dangerous decision is to use public debate to legitimize a policy. That was the case with the nuclear power phase-out policy under the Moon administration. Of course, opinions on the phase-out still differ, but given the current energy supply and demand situation, it was a failed policy. Even if many participants at this forum support higher holding taxes, there is no guarantee that following that view will achieve the policy goal of bringing housing prices down and stabilizing them. The so-called 'tyranny of the majority' must be avoided. Nor should the forum become a mere formality or procedure for raising taxes.
A common feature of housing price measures under past administrations has been expanding supply. The Lee Jae Myung administration is also likely to see supply as the most important measure. The problem is the lack of available land. Even so, the focus of real estate policy should always remain on supply. The right approach is to look for more land where homes can be built, such as Taereung Golf Course, and center policy on increasing supply. Easing conditions for redevelopment and reconstruction should also be included as a topic for discussion.