Housing Minister Hong Jisun: Home Prices Will Stabilize by Year-End

Hong Jisun, the Minister of Land, Infrastructure and Transport, stated on October 7 that "home prices in the Gangnam area and Yongsan have already turned negative, and the price increases in other regions are also slowing down." He added, "By the end of the year, the rate of increase in housing prices will decrease."

Minister Hong made these remarks during a National Assembly audit when responding to a question from Kim Jeong-jae, a member of the ruling People Power Party, regarding the current housing market situation and future price forecasts.

He identified supply shortages as a key factor behind recent price increases, explaining, "Over the past three years, there has been insufficient housing supply compared to demand." He noted that the housing market is influenced by multiple factors, not just one.

Regarding the potential extension of land transaction permit zones, he said, "We are closely monitoring the housing market and reviewing the situation." On the possibility of expanding these zones, he emphasized that it is not simply a matter of the Ministry of Land deciding but requires a comprehensive view of factors like subscription competition rates, stating, "This is not a definitive statement, but we will continue to observe and review the housing market closely."

In response to President Lee Jae-myung's comments about 'real estate stabilization,' he clarified, "I understand the President's remarks as an explanation of the housing market situation, not as an indication that things are going well."

On the lease market, he described the decreasing share of lease agreements as a 'megatrend.' When asked if he agreed with the prediction that the lease system would disappear, he replied, "With the increase in single-person households and the impact of lease fraud, I see it as a megatrend."

However, he refuted claims by Kim that government policies are driving the lease system's demise, stating, "That is not the case." He explained that the Housing and Urban Guarantee Corporation (HUG) is implementing a trust system to protect tenants' lease deposits.

Regarding the issue of long-term maintenance funds, he noted, "Each apartment has an internal audit system, and if issues arise, local governments have the authority to investigate." He added that investigations can be conducted to determine if there are any problems.