"We will definitely crack down on speculation... speeding up housing supply in Seoul"

On the 30th, President Lee Jae-myung stressed, "The people's sovereignty government will definitely eradicate the ruinous real estate speculation by any means necessary." He also said, "Unfair and irrational tax systems that have been shown to encourage real estate speculation will also be corrected without fail, from the standpoint of tax justice." He reiterated his determination to supply large volumes of housing in Seoul and the greater Seoul area at an early date, and said he had instructed officials to prepare a system to buy up large numbers of homes below a certain standard for use as public housing in case prices plunge.
That day, President Lee shared a news article on X, formerly Twitter, which said that Morgan Stanley had raised its GDP growth forecasts for South Korea this year and next year, while the Bank of Korea's pace of rate hikes was expected to be faster than anticipated and to reach 3.5% by the end of the first quarter of next year amid inflationary pressure. He wrote, "Those interested in real estate speculation should pay particular attention to the part of the article that says, 'The BOK's 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 U.S. rate level, the interest rate relationship between the U.S. and South Korea, and the fact that low growth, which had been blocking rate normalization, is being overcome quickly."
He added, "The government will mobilize all of its capabilities for financial and tax reforms, as well as for expanding housing supply and ensuring it is delivered quickly." He emphasized, "In the short term, accelerating housing construction is the best way to overcome weak domestic demand and the limits of K-shaped growth, so the early mass supply of housing in Seoul and the greater Seoul area is a win-win policy and must be carried out."
He also noted, "In the greater Seoul area, especially Seoul, housing permits and construction starts have fallen sharply for more than three years since 2022." He said, "We will provide the maximum possible incentives for early permits and construction, including granting district heads the authority to approve projects of fewer than 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 financing to increase housing supply, and increasing loans for end-users such as young people, are effective and necessary targeted policies." He added, "There is financing that increases housing supply, and there is financing that increases housing demand."
He reaffirmed plans to ease concentration in the greater Seoul area. President Lee said, "Early relocation of state agencies to Sejong, rapid construction of the administrative capital, early relocation of the largest public institutions to the provinces, and the early implementation of the 3 Major Mega Projects and the 7 Major Seed Policies will also greatly help stabilize the real estate market in the greater Seoul area."
He also said, "The government has instructed officials to prepare a system to buy large quantities of homes below a certain standard for use as public housing in case prices plunge due to early mass supply, suppression of speculative demand, and a surge in loan delinquencies and auctions caused by high interest rates."
Regarding how reforms should be pursued, President Lee said, "Making arguments is the role of those challenging for power, while the role of those who have already won power is to deliver and produce 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."
[email protected] Choi Jong-geun Reporter