Issue Focus

● The government's view on the real estate policy is that the reconstruction project encourages overheating and speculation in the housing market. Accordingly, through several real estate measures, the government has established regulatory barriers throughout the entire stage of the reconstruction project. Excessive regulations are causing side effects that hinder the promotion of reconstruction projects. It also makes it difficult to supply new homes in the city center. If this policy of regulation of reconstruction continues, the real estate market will further weaken stability due to an imbalance in housing supply and demand. ● Major regulations for reconstruction projects include limiting the status of members of the reconstruction industry, re-establishing excess profits, limiting the sale of the general distribution of reconstruction, and strengthening the standard for safety diagnosis of reconstruction. ● Currently, the domestic real estate market is entering a recession stage. The reason for this is that the government's regulations, as well as massive volume of goods to move in, ending low interest rates, and raising interest rates are all reflected in the overall picture. ● The fact that various regulations have virtually blocked reconstruction projects in Seoul and other metropolitan areas is feared to lead to a shortage of supplies in the long-term. This is tantamount to growing potential instability in the real estate market. It is also worrisome that there is no clear alternative to the aging of apartments due to regulations on reconstruction projects. ● The contraction of the real estate market is likely to be the cause of the overall economic slowdown in the region. To make matters worse, if the domestic real estate market makes a steep hard landing, regulations on reconstruction will threaten even jobs at construction sites. ● The government does not appear to be making a close analysis of why housing prices are rising in Gangnam, Seoul. It is highly likely that bringing reconstruction projects to the forefront of the overheated real estate market will only escalate social conflicts. It is not desirable to drive ambiguous speculative forces and multiple homeowners into red-and-white forces. These frame settings are the development of a healthy housing market. ● The government needs to reflect on past examples when implementing policies for reconstruction projects. It is urgent to harmonize the regulations, including supplementation, which takes into account the market conditions of each region, instead of focusing on unilateral regulations. The government should never overlook this suggestion.