[EDITORIALS]The real estate policy? Fear.After not getting much out of its measures on real estate, the government has begun “carpet bombing” apartments in specific neighborhoods. Put crudely, it is trying to scare people. The government has even set a detailed date and price goal, saying that units for sale will “pour out” at the end of the year, and that it plans to drop real estate prices to the level they were when the government first announced its plans to curb speculation in October 2004. It seems as if the Blue House, governing Uri Party, Finance Ministry and Construction Ministry are all taking part in issuing reports on apartment prices. We wonder, however, if the government isn’t making a fuss because it is aware of people’s apathy in light of the upcoming regional elections. If that is indeed true, then all it is doing is offering a remedy to a disease it created. In fact, the prices of apartments in certain districts have shot up to an astonishing degree since the Roh Moo-hyun administration took office. Low interest rates, huge mortgage loans and weak policies created a worst-case scenario. If the government had only raised interest rates and provided sufficient housing, we wouldn’t have wound up in this situation.
It is hilarious that the Blue House and government are playing patty-cake, seemingly looking forward to the real-estate bubble bursting. We have never seen a government that picks out certain neighborhoods and judges them, saying “you’re okay” or “you’re a bubble.”
If they thought scaring the market would work, they were terribly wrong. We have already witnessed the government’s “indiscriminate bombing” 35 times. In a sense, it is fortunate that regardless of the government’s intentions, the market looks as if it will change.
Recently, we have witnessed an overseas trend of asset bubbles bursting, and in Korea, rural areas with a glut of apartments are acting as omens of a burst.
Right now, we must start making mid- and long-term plans. As the baby boom generation grows older, tastes on real estate are changing. We must find ways to keep providing quality housing. That is a shortcut to getting a hold on real estate prices. If the bubble burst, as the government asserts it will, it would be a nightmare. Could a government that cannot prevent a bubble from bursting be able to come up with sufficient countermeasures? If the people have to deal with a lack of measures in addition to the shock of a bubble burst, this administration would be going to the verge of tyranny.
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