Seoul's apartment prices have risen for 88 consecutive weeks, prompting a heated debate during a National Assembly audit regarding the removal of land transaction permit zones and housing supply shortages. Opposition lawmakers criticized the city government's regulatory rollbacks and poor supply performance, while Seoul Mayor Oh Se-hoon attributed the instability in housing prices to past decisions on redevelopment zones and government real estate policies.
During the National Assembly's Land, Infrastructure and Transport Committee audit on October 19, lawmakers questioned the causes of rising housing prices in Seoul and the adequacy of housing supply policies. A key point of contention was the city's decision to lift land transaction permit zones in the Gangnam area last February.
Democratic Party lawmaker Jang Jong-tae pointed out that an internal report from the Seoul city government assessed transaction volume fluctuations in certain areas as 'unstable' just before the permit removal.
According to Jang, an internal report dated February 11 indicated that the transaction volume fluctuations for apartments in Samsung, Daechi, and Cheongdam-dong were 203%, 101%, and 439.7%, respectively. However, the city lifted the permit restrictions for 291 complexes in the Jamsil, Samsung, Daechi, and Cheongdam areas the following day.
Jang claimed that during the 35 days following the permit removal until re-designation, apartment transaction volumes in the three Gangnam districts and Yongsan tripled, with transaction amounts increasing from 2.6 trillion won to 7.8 trillion won.
In response, Mayor Oh stated that the real estate market was in a downturn at the time, necessitating regulatory relief. He explained, 'In December 2024, housing prices were declining, and both the Bank of Korea and major banks' real estate research institutions had issued reports indicating that the housing market was excessively stagnant and needed intervention.'
The disparity in housing supply across different regions of Seoul was also scrutinized. Jang noted that while the average monthly completion rate in the three Gangnam districts increased by 11.5% before and after Oh's inauguration, it decreased by 43% in the remaining 22 districts.
He also presented data showing that while the approval rates in the three Gangnam districts fell by 5.3%, the other 22 districts saw a 14.5% decline.
Oh acknowledged the regional disparities in supply performance but countered that the removal of redevelopment zones in the past has contributed to the current supply shortages. He stated, 'While it is true that new housing has increased in Gangnam, the decrease in approvals and starts in the northern and southwestern regions is significant. Analyzing the causes, the impact of the 389 redevelopment and reconstruction zones that were lifted during former Mayor Park Won-soon is considerable.'
The differing perspectives on housing supply policies between the Seoul city government and the national government were once again highlighted.
When People Power Party lawmaker Shin Sung-bum asked about the appropriate housing supply levels and the necessity of redevelopment projects, Oh explained that experts generally agree that an annual supply of about 40,000 new homes is needed to achieve a balance in supply and demand. He emphasized that redevelopment and reconstruction projects account for about two-thirds of new housing supply in Seoul, stating that without revitalizing these projects, it would be difficult to resolve the housing crisis.
Regarding future housing price trends, differences in outlook between the government and the Seoul city government emerged. When Shin inquired about the government's projections for housing market stability, Oh noted that the shortage of rental properties and rising rents in Seoul are attracting buying demand. He specifically predicted that the upward trend in apartment prices in the northeastern and southwestern outskirts would be difficult to reverse in the near term.
* This article has been translated by AI.
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