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Report: Roh’s Ideological Approach to Real Estate Caused Adversity

Report: Roh’s Ideological Approach to Real Estate Caused Adversity

Posted December. 07, 2007 05:25,   


The Construction and Economy Research Institute of Korea (CERIK) pointed out Thursday that the Roh administration made real estate policies not from an economic, but an ideological perspective, causing adverse effects.

The think-tank said that the administration focused only on curbing demand and balancing development, causing higher real estate and housing prices as well as excessive flexibility. It also said that these factors have worsened inequalities by income and region.

CERIK released a report titled “Future Policy Challenges on Housing and Real Estate” that evaluates current real estate policies and proposes improvements for the next administration. The institute is a major think-tank in the construction sector headed by the president of the Construction Association of Korea.

Real Estate Policies Distorted by Ideology-

The 77-page report pointed out that Roh’s real estate policies were flawed from the start. It said that the administration found solutions fight against speculators rather than improve the economy.

The report said, “The administration saw the real estate market not as a place for transactions of goods, but as a place where the rich and the poor antagonize each other, creating a social environment that encouraged people to view those with real estate and land assets as immoral.”

As a result, it pointed out that the administration failed to increase housing supplies in high demand areas, caused soaring real estate and new-home prices, and ignored the problem of excessive flexibility caused by low interest rates and huge real estate compensation totals. In short, the report said that the administration has failed to address the fundamental problem of the real estate market in Korea.

Income and Regional Gaps-

The report also said that despite the government’s focus on bipolarization problems, the government has widened the income and regional gap.

In particular, it criticized the lack of sophistication in setting and implementing policies that minimize trial and error, and mistakes.

According to the report, when the Office of the Prime Minister and the Presidential Office took the lead in making real estate policies, working-level officials’ voices were not considered, and a series of ineffective solutions created public distrust of those policies.