An End to Real Estate Speculation

While announcing the government’s “Comprehensive Real Estate Countermeasures” Wednesday, Deputy Prime Minister and Minister of Finance and Economy Han Duck-soo stated, “It is desirable for housing prices to return to the level they were at prior to the ‘October 29 Measures’ of 2003.” This is the first time the government has specified a target range it expects housing prices to reach as a result of the current countermeasures.

The National Tax Service (NTS) has embarked on a special audit for the Geoyeo area of Songpa-gu, Seoul, which will be developed as a mini new town. In addition, the government plans to expose and tax those who have falsely registered a division of their households in order to evade taxation.

Deputy Prime Minister Han, Minister of Construction and Transportation Chu Byung-jik, and NTS Commissioner Lee Ju-sung held a joint press conference at the Gwacheon Government Complex for the official announcement of the “August 31 Comprehensive Real Estate Countermeasures.”

At the press conference, Deputy Prime Minister Han noted, “We want to convey a strong message: the facile idea that real estate policies would change in time ends as of today,” and declared that “real estate speculation is now over.”

The NTS’ speculation audit for the area in and around the Geoyeo new town, which will be developed over two million pyeong, is separate from the current countermeasures. The list of auditees comprises 239 people suspected of engaging in real estate speculation in Geoyeo-dong, Jangji-dong, and Macheon-dong, as well as in the industrial town and the KTX station’s environs.

As part of the countermeasures, the government announced that it would provide 45 million pyeong of residential land in the metropolitan area over five years starting in 2006, which will accommodate a total of 1.5 million new housing units. Among these, 415,000 will be large and midsized homes.

In the urban redevelopment zones slated for public development, the mandated floor area ratio will be increased to 250-300 percent while the restriction on building height (currently five to 25 stories) will be similarly alleviated.

Minister Chu said, “If anyone has falsely reported a division of households for tax evasion, he or she will be discovered and taxed accordingly.” He added, “If other factors that cause instability in the market arise, we will come up with additional countermeasures to combat them.”