Fiscal chief apologizes for failing to curb housing prices

SEJONG -- Deputy Prime Minister and Finance Minister Hong Nam-ki apologized for failing to curb apartment prices, but said the government’s real estate measures have been consistent.

“The government has pushed for real estate policies in a consistent manner under the three principles of increasing supply, protecting real demand and restraining speculative investment,” he said during a ministerial meeting on Wednesday.

He said that he felt sorry about the situation in which “the market has not eventually been linked to price stabilization.”

Nonetheless, the minister stressed that the government has not been negligent in increasing home supply.

“Both the number of new homes and government-led performance for securing land to build housing outstripped figures in past (administrations),” he said.

On the back of supply plans during the Moon Jae-in administration, the home supply starting from 2025 could exceed market expectations, though the supply since 2020 had fallen short of the demand, he said.

The government has carried out taxation policies such as levying heavier capital gains taxes in order to redistribute concentration of wealth so that people without their own homes can have one, he said, adding that the market has seen some changes recently.

“The real estate market has stabilized since the latter half of last year,” he said. The incoming administration is expected to seek new policies under a new administrative philosophy, he added.

Hong said the government has taken consistent countermeasures against unauthorized practices, including speculative investment.

Over the past five years, the Moon administration has been active in providing new apartments for newlyweds in their 20s and 30s by introducing the system of special supply.

This caused discontent among those in their 40s or 50s, who had been accumulating personal scores for state-led apartment subscriptions for decades.

The administration also drastically cut issuance of mortgage loans for home buyers in Seoul, which only benefited those with a large amount of cash in hand.

By Kim Yon-se (kys@heraldcorp.com)