Full of twists and turnsOn Monday, President Moon Jae-in decided not to lift the decades-old ban on developing greenbelt zones surrounding Seoul to control soaring real estate prices in the Seoul metropolitan area. But the lead-up to the presidential order makes the public doubt if his government really has any coherent housing policy. After Moon had ordered increases in housing supplies, the government floated the idea of easing regulations on greenbelt zones in Gangnam and Seocho districts — real estate hot spots in southern Seoul. Hong Nam-ki, deputy prime minister and finance minister, joined the bandwagon saying the option of lifting the ban was on the table.
Then, Park Sun-ho, vice minister of the Land, Infrastructure and Transport Ministry, denied that the government was considering the option. A meeting of the government and leadership of the ruling Democratic Party (DP) discussed inclusion of easing green belt regulations in Seoul to help increase housing supplies. And in an interview on Sunday, Prime Minister Chung Sye-kyun said revising green belt should be dealt with discreetly because “once the zone is violated, it cannot be restored.”
Credibility is the key to public policy. It is especially important in a policy aimed to cool the heated real estate market. The market will respond when it has trust in the weight of comments from policymakers. But senior government officials, even including Justice Minster Choo Mi-ae, have been speaking differently on the greenbelt issue. The confusion only discredits the real estate policy of the government. The government has so far announced a whopping 22 sets of measures, which only ended up fueling housing and rent prices.
Rep. Jin Sung-joon, a DP lawmaker and a member of the Land and Transport Committee in the National Assembly, only worsened the confusion through his casual comments made during a TV debate. Without realizing the microphone was still on after the debate ended, he told the others, “[Housing] prices will not fall … [Runaway] housing prices are nothing new.” People sneered that the only truth from the 99-minute TV debate among policymakers was the last 1-minute comment from Jin. People suspect that real estate measures are aimed at collecting more taxes. Some of them have begun to take the issue to the street.
Meanwhile, land prices around the greenbelt zones are beginning to rise. The people are getting wary and losing patience.