Kim Yong-beom, Chief of the Presidential Office for Policy, stressed Wednesday that "we must discuss extraordinary measures to the point of saying we should 'just build homes no matter what.'" He made the remarks at a forum hosted by the Kwanhun Club at the Korea Press Center.
The comment is interpreted as revealing the government's sense of crisis that demand-suppression policies alone have limits in stabilizing the real estate market.
Kim drew particular attention by citing specific alternatives that could dramatically increase housing supply within Seoul. He diagnosed the current real estate market instability as stemming from "structural supply shortages caused by project financing (PF) distress and high interest rates two to three years ago," emphasizing the need to utilize the semi-industrial zones around Yeongdeungpo and Guro.
"There are many old complexes left in Seoul's industrial districts such as Yeongdeungpo and Guro," Kim said. "When I asked why housing cannot be built in these places, they said Seoul needs to maintain its manufacturing base, but now is the time to discuss extraordinary measures to increase supply." He also hinted at differences with the Seoul Metropolitan Government over policy leadership, saying, "It is also connected to who takes the lead in drawing up the (supply measure) plans."
Regarding criticism that the current surge in housing prices resembles that of past progressive administrations, including the Roh Moo-hyun and Moon Jae-in governments, Kim called it "a meaningful but lazy observation," analyzing it as "a phase in which structural supply-demand problems and the macro (liquidity) environment are combined in a very difficult way."
"2023 and 2024 were a period when supply-related companies suffered extreme hardship due to the PF crisis and high interest rates," he explained. "Because of this, supply preparation was 30 to 40 percent short compared to previous years." His diagnosis is that, since it takes two to three years from breaking ground to actual move-in for housing supply, the supply vacuum at that time is leading to a structural supply shortage from 2026 onward.
On the demand side, by contrast, the analysis is that the strongest liquidity market in years has formed due to the semiconductor boom and rising corporate profits, stimulating the real estate market.
Based on this diagnosis of structural supply-demand imbalance, the government plans to hold a real estate "national public forum" next month to seek solutions. According to ruling party sources, the Presidential Office and relevant ministries are preparing an open forum to discuss the overall real estate market around the 15th of next month. It is expected to take a format similar to the existing town hall meetings presided over directly by President Lee Jae-myung.
The forum is expected to draw a large number of key stakeholders in the real estate market, including not only professors and tax experts but also operators and members of "mom cafes," real estate YouTubers, licensed real estate agents, young people without homes, newlyweds, and multi-home owners. The Presidential Office's decision not to limit who can be invited is interpreted as an intention to broadly hear views for and against before announcing policy and to build social consensus.
"The forum is not about reaching a specific conclusion, but will be an occasion for President Lee to directly listen to various opinions," a key Presidential Office official said. "If opinions arise that property holding taxes should not be raised, it could become a process of asking together what the alternatives are and finding common ground." This means the government intends to hear not only experts' analyses but also the on-the-ground voices felt by market participants.
The forum is expected to discuss real estate policy as a whole, including not only supply expansion but also taxation, financial regulations, reconstruction and redevelopment, the jeonse (a Korean lease system requiring a large lump-sum deposit instead of monthly rent) market, and measures to protect genuine homebuyers. In particular, with the tax reform plan set to be announced at the end of July, reforms to property holding taxes and capital gains taxes are cited as the biggest points of contention.
Asked about the direction of real estate tax policy, Kim said, "Rather than trying to control real estate through taxation, taxation is an important subject from the perspective of how to manage it." He added, "We are running hundreds of simulations to find reasonable measures." He continued, "There is the issue of tax fairness, and there is also the goal of housing market stability," and "We are broadly reviewing not only state-run research institutes but also overseas cases."
"President Lee has also presented several principles," he explained. "He set out the standards that actual ownership and residence should be distinguished, that single-home owners and multi-home owners should be viewed differently, and that the issue of ultra-high-priced housing should be examined together."
In particular, Kim stressed, "We really want to hear many opinions," adding, "We will carefully decide policy through open discussion, including those with direct interests and even mom cafe (operators)."
A two-term lawmaker from the Seoul metropolitan area noted, "When it comes to real estate, virtually all citizens are stakeholders," pointing out that "real estate policy inevitably creates conflicts of interest the moment it is announced." He added, "It is important to set a direction after sufficiently hearing both sides on highly contentious issues, and to build national consensus."
The lawmaker projected, "I see this as part of the 'deliberation' that President Lee emphasizes," and "it will be possible to secure the legitimacy of policy along with the gathering of public opinion."
