Unconstitutional thinkingThe government is pushing for homeowners to have to ask for permission to buy or sell their homes, which may be against the Constitution, in a bid to tame apartment prices in Gangnam. In a radio interview, Kang Ki-jung, senior presidential secretary for political affairs, said the government should pay heed to the opinion that those who see real estate as a means for speculation should ask for permission first. Kim Sang-jo, presidential policy chief, said the government’s primary focus is to normalize housing prices in Gangnam and that it has “all possible policy means on the table” for immediate use.
Blue House staff has rallied around the idea after President Moon Jae-in vowed to “normalize home prices” during his New Year’s press conference.
The idea is highly dangerous. It was first studied under former liberal President Roh Moo-hyun but was scrapped as it would violate people’s constitutional rights to individual property and civilian freedom of residential choice. Yet the Moon Jae-in administration has flagged the controversial concept under the pretext of fighting “speculators.” But the campaign could produce more innocent casualties. That is why the plan was retracted under Roh.
The government policy of restricting mortgage loans in December has already been challenged at the Constitutional Court. Yet the Moon administration is pushing ahead with even more debatable measures. They must have little regard for the Constitution. The government is trotting out one reckless measure after another to make up for the flop of the former policy. Home prices have shot up at an unprecedented speed under Moon despite 18 real estate measures. Apartment prices in Seoul soared 40 percent. Since the multiple regulations in December, apartment prices in northern Seoul and rent prices have also jumped.
The government has not once come up with a measure to increase supply. It disregards the basic theory that supply should be increased upon demand. It has failed 18 times, and yet learned little. It remains to be seen if “all possible means” includes increases in supply.
Under former President Lee Myung-bak, the number of affordable homes increased greatly in Gangnam and ended up bringing down prices overall. Prices will never go down through suppressing demand. Supply must become available through redevelopment offerings. Even a ruling party lawmaker proposed granting the construction of 80-story residential high rises in Seoul. Education and infrastructure environment must be balanced to even out the demand. Making speculators the enemy cannot solve the housing problem.
JoongAng Ilbo, Jan. 16, Page 34