President Lee: "We Will Crush Destructive Real Estate Speculation by Any Means Necessary"

[Financial News] President Lee Jae-myung said on the 30th that "the people’s sovereignty government will definitely root out destructive real estate speculation by any means necessary." He added that "unfair and irrational tax systems that have been found to encourage real estate speculation will also be corrected without fail, from the standpoint of tax justice." He also reiterated his intention to supply large numbers of homes early in Seoul and the greater metropolitan area, and said he had instructed officials to prepare a system to buy up large numbers of homes below a certain standard for public housing use in case prices collapse.
That day, President Lee shared a news article on X, formerly Twitter, which said Morgan Stanley had raised its forecast for South Korea’s GDP growth this year and next year, while the Bank of Korea’s pace of rate hikes was expected to accelerate under inflationary pressure and reach 3.5% by the end of the first quarter of next year. He wrote, "Those interested in real estate speculation should pay particular attention to the part in the article that says the BOK rate is expected to be 3.5% in the first quarter of next year, six months from now. It is difficult to predict the direction of interest rates, but one must consider the level of U.S. rates, the rate relationship between the United States and South Korea, and the fact that low growth, which had been blocking a normalization of rates, is being overcome quickly."
He continued, "One more thing to note is that mortgage delinquencies and foreclosure listings are rising sharply," adding, "I hope you will also pay attention to the winning bid rate."
President Lee emphasized, "The government will mobilize all of its capacity not only for financial and tax reform, but also to expand housing supply and speed up delivery." He added, "In the short term, accelerating housing construction is the best way to overcome weak domestic demand and the limits of K-shaped growth, so early large-scale housing supply in Seoul and the metropolitan area is a win-win policy and must be implemented."
He specifically said that housing permits and groundbreaking in the metropolitan area, especially Seoul, had plunged for more than three years since 2022. He added that he would maximize incentives for early permits and construction, including granting district heads authority to approve projects of up to 500 households.
He also pushed back against criticism that the government’s expansion of total lending runs counter to its tighter financial regulation stance. President Lee explained, "Expanding finance to increase housing supply, and increasing loans for end users such as young people, are effective and necessary targeted policies." He added, "There is finance that increases housing supply, and there is finance that increases housing demand."
President Lee said, "We have increased staffing for the housing supply division at MOLIT and instructed officials to identify as many additional available sites as possible, even if they are small." He added, "To use the minister’s own expression, we will move as quickly as possible to expand supply, as if we were 'crazy about not being able to supply enough.' The Prime Minister checks progress every day, and Cheong Wa Dae is also conducting regular reviews."
He also reaffirmed plans to ease concentration in the greater Seoul area. President Lee said, "Early relocation of state agencies to Sejong City, rapid construction of the administrative capital, early relocation of the largest public institutions to regional areas, and the early realization of the three major mega projects and seven seed policies will all greatly help stabilize the real estate market in the metropolitan area."
He also said, "The government has instructed officials to prepare a system that will buy up large numbers of homes below a certain standard for public housing use in case housing prices collapse due to early large-scale supply, suppression of speculative demand, and a surge in loan delinquencies and auctions caused by high interest rates."
He stressed, "For the future of the country and the hopes of the next generation, we must eliminate the bomb of real estate speculation and the risk of a lost 30 years."
On the way reforms should be pursued, President Lee said, "Making arguments is the role of those challenging to gain power, while the role of those who have already won power is implementation and results." He added, "With the power already entrusted to us by the people, we should quietly and swiftly carry out the reforms needed by the people and the country."
He continued, "Whether the public trusts a political group will depend on who has actually improved people’s lives and who has the ability to do so." He added, "Let us overcome every abnormality and move together toward an irreplaceable Republic of Korea that creates the golden age of Korea, as Jensen Huang said."
[email protected] Choi Jong-geun Reporter