Prime Minister Criticizes Real Estate Policies

“If the property possession tax increases, Gangnam Ajumas, or middle-aged women living in Gangnam area, raise deposit money for the lease of a house. If the real estate transfer tax rises, they don’t sell houses until real estate policies change, since their apartment prices will rise due to high demand and the real estate transfer tax may drop when the new administration is inaugurated.”

Prime Minister Lee Hae-chan criticized in detail government real estate policies and its use of statistics on July 22, citing the government measures on real estate and “ajuma in Gangnam”. He said the government policies on property are not in line with reality.

He made these remarks in a special lecture to 60 directors of central government agencies in the Central Officials Training Institute in Jung-ang dong, Gwacheon. He said, “These days, real estate measures are being dealt with. Many proposals have been made such as increasing the property possession tax, lowering the transaction tax and raising the real estate transfer tax. Those proposals sound like what Confucius might have said. However, in addressing this issue, we should keep in mind that firing a gun does not always make bullets come out.”

“The time has come when we should use our brains in devising policies. It is important to draw up and implement policies that take into consideration the public demand,” he said.

On the issue of supplying rental houses, he said “There is talk about giving seven pyeong of rental apartments. Who would want to live in a seven-pyeong apartment these days? We have to provide houses that at least guarantee decent living conditions.”

As one of the examples of improper government use of statistics, he cited statistics on the working poor or those who fare slightly better than recipients of basic livelihood programs. According to statistics, almost 30 percent of Korean farmers are classified as working poor, but that is not true in reality. Even paltry farmers hold six to seven majigi of paddy field. The problem is that they are just marginalized in terms of education and culture.”

Kang-Myoung Chang tesomiom@donga.com