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Ruling party presidential contenders competing to pledge boost in housing supply

All News 15:52 August 05, 2021

SEOUL, Aug. 5 (Yonhap) -- With runaway housing prices continuing to weigh down the Moon Jae-in administration in its final year in office, presidential contenders from his ruling party are rushing to make election pledges to boost housing supply, raising the stakes of real estate policies in the ongoing presidential race.

The competition for housing policies among the presidential hopefuls of the Democratic Party (DP) came to a head this week after the party's two top rivals came up with high-stakes campaign pledges aimed at tackling housing issues.

Many people agree housing issues will take center stage in the March 9 presidential election after the DP, which won big in the 2020 parliamentary elections, suffered crushing defeats in the high-profile Seoul and Busan mayoral by-elections in April, due mainly to growing public discontent with the Moon government's housing policies.

This image shows real estate policy pledges by presidential contenders from the ruling Democratic Party. (Yonhap)

DP presidential contenders are pinning hope on a sharp increase in housing supply.

Gyeonggi Province Gov. Lee Jae-myung, currently the front runner in various opinion polls on DP's presidential hopefuls, pledged to supply more than 2.5 million housing units during his five-year term if he is elected president.

Of them, some 1 million units will be distributed under a "basic home" scheme, a policy affiliated with Lee's broader, signature "basic income" pledge, which will give non-homeowners rights to live in a high-quality public house at a low cost, stably for a term of over 30 years.

"In order to stabilize house prices and relieve the pain of non-homeowners, the country needs an expansion of supply as well as suppression of real estate speculation," Lee said in a press conference on Tuesday. "But the nature of the supply itself should also be transformed to cover a large amount of high-quality public houses," he noted.

The governor also said he will introduce a new homeland holding tax to discourage speculative real estate transactions as well as a new government agency in charge of creating housing and land policies.

Gyeonggi Gov. Lee Jae-myung announces real estate policy pledges during a press conference at the National Assembly in Seoul on Aug. 3, 2021. (Yonhap)

The next day, runner-up, ex-DP Chairman Rep. Lee Nak-yon followed suit, announcing a big-scale real estate plan, focused on building a "new smart city" on the outskirts of Seoul.

Lee said he will relocate the functions of Seoul Air Base, a military airport just south of Seoul, to create space for a new city with capacity of 30,000 housing units.

By further easing construction regulations in the areas surrounding the airport, he will supply 40,000 additional housing units, he suggested. Seoul Air Base is currently used to host the planes of the president and foreign VIPs as well as the aircraft of the U.S. forces stationed in the country.

"(By relocating the airport) it is possible to build a new smart city with capacity of 100,000 people, which is connected to two nearby city centers," Lee said.

"The security environment has changed greatly since the 1970s when the Seoul Air Base was built in the current location," he said, adding that moving it will benefit both the public and the safety of the military.

Rep. Lee Nak-yon announces his campaign pledges to boost housing supply during a press conference at the National Assembly in Seoul on Aug. 4, 2021. (Yonhap)

Another DP presidential contender, Rep. Park Yong-jin, has suggested Gimpo International Airport in western Seoul, not Seoul Air Base, should be relocated and incorporated to Incheon International Airport to enable the construction of a smart city with 200,000 new housing units, in his real estate policy pledge announced earlier.

Ex-Prime Minister Chung Sye-kyun, currently ranked No. 3 in opinion polls, pledged to supply 1 million units of public rental homes, plus 300,000 apartment units to be publicly distributed.

Ex-Justice Minister Choo Mi-ae committed a plan for a land reform in favor of public interest while Rep. Kim Du-kwan, former interior minister, pledged to introduce a state-led home mortgage program to help non-homeowners purchase homes.

The ambitious campaign pledges, however, immediately sparked criticism over their feasibility from not only presidential hopefuls from rival parties but also among DP presidential runners themselves.

Yoo Seong-min, a potential presidential contender with the main opposition People Power Party, raised skepticism over Gov. Lee's housing policy pledges and lambasted Lee for making a populist promise with little feasibility.

"All sound like a utopia ... but there's not a word about with what money he will build basic homes. Who on earth will finance the astronomical costs with what kind of money," he lashed out at Lee on social media on Tuesday.

"Gov. Lee should first disclose the financial specifics of the basic home scheme and how he will finance them," Yoo said, accusing the governor of trying to buy off voters with "bad populism."


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