The Lee Jae-myung government should not repeat the tweezers regulation.
To control house prices
Establish a comprehensive and consistent policy stance!
On the 13th, as announced at the meeting of the party and government (presidential office, government, ruling party), the third real estate policy was announced today (15th) since the inauguration of the Lee Jae-myung administration. It includes expanded designation of regulated areas and land transaction permit areas, and strengthening restrictions on housing loans exceeding KRW 1.5 billion within regulated areas. This measure is expected to be insufficient to control housing prices as it contains only fragmentary strengthening regulations without identifying the causes of rising housing prices. If the Lee Jae-myung government fails to control housing prices like the previous government did, the resulting damage will inevitably be borne by the people. The Citizens’ Coalition for Economic Justice urges the Lee Jae-myung government to make sincere efforts to control housing prices and argues as follows.
First, completely reexamine the 9.7 real estate measures that undermine public character and encourage rising housing prices!
During the term of the Yoon Seok-yeol administration, the real estate and construction industries were frozen cold. To resolve this issue, the Yoon administration has significantly relaxed various regulations, and its impact is having a significant impact on the current rise in housing prices. The Lee Jae-myung government did not intend to correct the problems of the previous government, and announced a policy of expanding redevelopment and reconstruction through the 9.7 measures, including discovering candidate sites for redevelopment projects, inducing business activation, and expanding floor area ratio relaxation regulations. It is a known fact that the revitalization of redevelopment and reconstruction projects is the cause of rising housing prices. Prior to supply through redevelopment and reconstruction, measures to suppress speculative demand and recover development profits must be prerequisites.
The plan to introduce 140,000 newly built purchase rental units is also a big problem. When purchasing a newly built house, land purchase costs and construction cost bubbles are all included. The more the government increases the purchase of new construction, the greater the waste of taxpayer money, which stimulates surrounding housing prices. Nevertheless, the government promised to provide incentives to contractors if they secure land ownership or start construction early. In the end, it is natural that house prices rose further after the announcement of the September 7 measures. If there is no comprehensive review of this, we have no choice but to conclude that the government and ruling party’s true intention is not to control housing prices, but rather to raise them.
Second, instead of repeating the tweezers regulation, establish a comprehensive and consistent policy framework to control housing prices!
The reliance on financial policy and expansion of regulatory areas while ignoring fundamental measures is reminiscent of the Moon Jae-in administration’s policy, represented by the tweezers regulation. Even though housing prices soared, the Moon Jae-in administration failed to come up with a clear solution and only overused measures before handing over power. If the Lee Jae-myung administration does not want to repeat the same process, it must establish a consistent and long-term policy stance based on a strong will to control housing prices.
Accurate statistics are the core basis for policy establishment. However, it has long been pointed out that the government’s housing price statistics do not reflect reality and are distorted. The Lee Jae-myung government must transparently disclose and verify the calculation basis for all government real estate statistics, including house price statistics, publicly announced land prices, and publicly announced prices, and establish real estate statistics that the public can trust. The basic comprehensive real estate tax deduction amount should be restored to 600 million won per person, and various preferential treatment such as the fair market value ratio system that lowers the tax base and special deductions for long-term holding of expensive homes should be abolished. We must also devise a plan for taxation based on the number of houses and fair taxation based on house prices. For housing mortgage loans, the DSR system, which lends an amount that can be afforded depending on the consumer’s income level, should be further strengthened, and rental deposit loans to those who own a home should be stopped immediately as it is a policy that promotes gap speculation.
Third, the Lee Jae-myung government should actively pursue reform of the broken housing supply system!
The most fundamental measure to control housing prices is to completely reform the broken housing supply system and completely change the structure of easily making money through real estate. Under the current housing pre-sale system, even if you do not have a single penny of equity capital, you can build a house using various guarantee systems and sales proceeds. As prospective adopters had to rely on loans to pay for the sale without their own money, the housing sale market degenerated into a speculative market. As a result, when the real estate market slumped, the financial sector was exposed to serious risks and had a negative impact on the overall national economy. The Lee Jae-myung government must correct the distorted housing supply system by implementing a post-sale system.
In a state where the post-sale system is not implemented, policies that limit high pre-sale prices, such as the pre-sale price cap system, must be applied. The development profit recovery system must be strengthened at all stages of development, from land development to apartment sales, to prevent housing supply developers from monopolizing development profits. Public housing sales prices should be transparently disclosed on the public housing corporation website so that citizens can freely use them. If the housing supply system cannot be reformed, the expansion of supply will inevitably lead to further increases in real estate prices and deepen the serious household debt problem. Private sector participation projects emphasized in the 9.7 measures must be completely abolished. This is because it will inevitably lead to inflating the prices of public housing in order to guarantee the profits of private construction companies.
Solving the real estate problem must be pursued consistently and gradually by establishing a long-term plan on how to efficiently distribute the limited resource of real estate for national economic development. The tweezers-style regulation not only makes the problem more complicated, but also creates a backlash and causes the momentum for reform to be lost. The Citizens’ Coalition for Economic Justice strongly urges the Lee Jae-myung administration to make sincere efforts to control housing prices and will not stop criticizing and monitoring in the future.
October 15, 2025
Citizens’ Coalition for Economic Justice
