[EDITORIALS]Apartment shopping spree

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[EDITORIALS]Apartment shopping spree

The National Tax Service announced its findings on the source of funds of those who bought apartments in Gangman, Seoul's expensive residential area south of the Han River. According to the agency's announcement, about one-third of 252 households investigated, 86 purchasers, had bought five or more apartments in the Seoul and surrounding metropolitan area. Some of them seem to have been on a "shopping spree" for apartments.

Since 2000, one woman in her 50s has bought 17 apartments -- all in Gangnam -- with high possibilities of being designated for reconstruction. Another man, also in his 50s, bought 12 apartments and sales rights, all of which he resold. A high-powered lawyer-doctor couple bought up 10 reconstruction candidates in Gangnam and nearby areas. These reports deepen the sighs of average Koreans who live in daily anxiety over skyrocketing housing prices.

Apartments are economic goods. There are people who make a living off rents, which is fine as long as they pay taxes. The woman who bought 17 apartments said that she had no source of income, meaning she paid no income tax, yet she spent 3.6 billion won ($3 million) to buy them. The lawyer-doctor couple, incredibly, reported their past four years' income as 33 million won. Theirs is the face of greed, not hesitating to evade taxes to increase material gain.

We must ask just what the tax and administrative officials were doing while these speculations were taking place right under their noses. If they had used just a bit of the data network available at their office, it would have been easy to find general information about the purchasers and to sniff out the speculators. But only when prices already had soared to a peak did these government officials get to work. Their retroactive actions call into question just how effective they can be. The government's failure to crack down on such speculation will make it impossible to keep housing prices at a market level in which demand is fully supplied.
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