Kim Yoon-deok, the Minister of Land, Infrastructure and Transport, emphasized the need to expand housing supply to mitigate the impact of tax reforms on the housing market. He proposed a gradual implementation of tax changes to address potential instability in the rental market as non-resident homeowners transition to actual residence, planning to offset any supply shortages with new housing developments.
During a National Assembly meeting on August 11, Kim responded to concerns that non-resident homeowners might disrupt the rental market by evicting tenants for personal occupancy. He stated, "I believe it is better to implement various tax issues gradually to reduce market shocks."
Regarding the transition to actual residence, he noted, "There will be no changes until the end of next year," and assured that the implementation would be gradual, allowing for adjustments in supply during the transition period.
The direction of the tax reform focuses on a housing market centered on actual residence and normalizing real estate taxation. Kim explained that this aims to enhance tax equity and establish a sustainable and rational real estate tax system.
Ultimately, the government intends to absorb potential shocks in the rental market during the tax reform process through increased supply.
The key to expanding supply is 'speed.' Kim stressed the importance of building more homes in Seoul and the surrounding metropolitan area. He plans to shorten the approval process for private redevelopment projects and expedite the start of the third new town initiative.
Kim also left open the possibility of lifting greenbelt restrictions, stating, "I believe we need to supply more housing in the metropolitan area, even if it means releasing greenbelt land." He aims to boost non-apartment housing supply to meet rental demand.
Collaboration with Seoul City will also be strengthened. Addressing disagreements over supply volumes, such as in the Yongsan International Business District, he mentioned, "We are seeing significant alignment on opinions and are making adjustments," indicating that the Ministry is actively considering Seoul's requests.
The government plans to aggressively purchase rental housing. However, Kim acknowledged that issues raised in the existing rental housing program by the Korea Land and Housing Corporation (LH) would also be taken into account.
In response to President Lee Jae-myung's call for improvements to the 'marriage penalty,' Kim noted the potential for relaxing income requirements for policy loans and increasing loan limits, stating, "I think both are interconnected."
To continuously inform the public about housing supply measures, the government proposed creating a 'metropolitan housing supply dashboard.' This initiative aims to enhance policy credibility by not only announcing supply targets but also disclosing actual construction and supply progress.
* This article has been translated by AI.
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