Hong Ji-seon, the nominee for Minister of Land, Infrastructure and Transport, emphasized the importance of consistent and predictable policies for stabilizing the housing market during her first day at work following her nomination. It appears that the Ministry's focus on accelerating housing supply will remain largely unchanged.
However, it remains to be seen how Hong's assessment of supply has evolved and whether she will maintain the principles of transportation, environment, and local government collaboration that she previously emphasized during the current push for faster supply.
According to records from the Ministry of Land, Infrastructure and Transport and the Gyeonggi Provincial Assembly, Hong, who was the head of the Urban Housing Division in Gyeonggi Province in 2021, identified the issues in the housing market as stemming more from rising prices and excessive loans rather than a lack of overall supply. She criticized the central government's approach to new town development, arguing that it should adequately consider local urban planning and transportation and environmental factors.
Five years later, the situation has changed. Hong is now the candidate to lead the Ministry, tasked with significantly increasing housing supply in the metropolitan area and expediting the construction of new housing sites and public land.
During an administrative audit in November 2021, Hong stated, “In Gyeonggi Province, the housing supply rate has already exceeded 100%, so it is not that there is a shortage of housing itself.”
At that time, Hong focused on prices. She viewed the rapid increase in home and rental prices, along with the trend of excessive borrowing known as 'young-geul' (a term for young people stretching their finances to buy homes), as problematic, leading to the use of housing as a speculative tool.
As a solution, she proposed the concept of basic housing, which aimed to provide public rental housing for the homeless to live stably for extended periods, regardless of income or assets, thereby reducing competition for home ownership.
The current government's approach emphasizes expanding supply. In addition to the existing goal of starting construction on 1.35 million units in the metropolitan area by 2030, the August 13 measures introduced an additional supply effect of 230,000 units. The government has prioritized the announcement of new public housing sites, including 21,700 units in the Namyangju city center, with plans to reveal an additional 73,000 units.
There is also interest in whether Hong's critical stance on the central government's designation of new towns will change. During the same administrative audit, she pointed out that the central government’s designation of large new towns without adequately linking them to Gyeonggi Province's long-term urban planning could undermine local urban planning.
This concern arises from the potential transportation and environmental issues that could follow if housing is supplied first. She emphasized the principle of 'transportation first, then occupancy' for the third-phase new towns.
As a minister, her position will shift. The candidate who once expressed concerns about the central government's unilateral land development from the perspective of local governments must now select new housing sites directly from the central government and persuade local authorities.
The current administration is also pursuing 'universal public rental housing' through the August 13 measures. While it shares philosophical similarities with the concept of basic housing by providing quality housing in good locations at affordable rents with guaranteed long-term residency, the specifics regarding income and asset criteria, rent, duration of residence, and funding have yet to be clarified, making it difficult to definitively categorize it as basic housing.
An industry insider noted, “From the moment she takes office as minister, it will be a significant test. In Gyeonggi Province, there have been obstacles due to higher laws and land and public enterprise resources, but the central government can utilize much stronger means such as legislative action and the Korea Land and Housing Corporation, as well as housing and urban funds.”
* This article has been translated by AI.
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