Hypocrisy at the topIn June 2017, a month after President Moon Jae-in took office, the government announced its first set of measures to cool off the real estate market, pushing down caps on loan-to-value and debt-to-income ratios by 10 percentage points to restrict mortgages. Since then, the government rolled more and stronger measures. It toughened the criteria for loans and new building licenses and pushed up different taxes — everything possible to rein in speculation and cool the market.
Although not everyone agreed with the regulations and taxes, the general public accepted the measures because they believed the idea behind them, which is to reduce notoriously high apartment prices and make them affordable for the middle and working class to ease real estate inequalities. They came to agree with the presidential office’s reasoning that people should not own more than two apartments regardless of the fact that it interfered with the free market.
It is no wonder the public is astonished to learn that presidential spokesman Kim Eui-kyeom took out bank loans of 1.6 billion won ($1.4 million) to buy a building in a district under redevelopment and a hot zone that was eventually regulated for overheating. They are angered that someone who described real estate investment as evil was actually a whiz at it.
The general public is enraged by the two-faced real estate policy. Real estate trading has come to a standstill due to multiple regulations. Yet the spokesman somehow won two apartment units and a space in a commercial building through his property investment. This cannot be excused. The Blue House must apologize. The people are suffering from sluggish housing values. The realtor industry could face bankruptcies due to a lack of trade.
How Kim was able to easily borrow 1.6 billion won in loans must be explained. The bank claims there was no pressure exerted. A young entrepreneur cannot get 100 million won from a bank even with a prospective start-up idea.
Kim’s use of a staff residence also raises questions. Even the Defense Ministry does not supply residences for its emergency staff if they have home in Seoul. Yet Kim got one.
Somehow the administration’s new ministerial nominees all seem to be investment gurus. The spokesman’s hypocrisy adds to public disillusionment. With senior officials like these, who could trust the policies they come up with?
JoongAng Ilbo, March 29, Page 38