Sack the land ministerInsensitive remarks from Land and Transport Minister Kim Hyun-mee have once again added fury to the people whose livelihoods have been weighed down by concerns over housing. “I would go on making them day and night if apartments were bread,” she said. Whether she intended it or not, she was admitting to the utter failure of the government’s real estate policy through her comical metaphor on the sheer shortage of supplies.
It is common sense that supply and demand show a time gap in the estate market. So, the government must take this into account. But it has entirely neglected the supply side.
The government has finally come around to tend to the supply. But it first blamed it on the past conservative government. Kim said that apartment offerings for 2021 and 2022 were less than current ones because the previous administration was reluctant to offer new apartments five years ago. She has gotten the facts wrong. Permission for constructors to build new apartments stayed robust at an average 96,000 units from 2015 to 2017. Permits have been declining from 2018 under the Moon Jae-in administration. The number stopped at 39,000 units as of September, down 20 percent on year. The decline in offerings in Seoul owes much to strict restrictions on redevelopments by former Seoul Mayor Park Won-soon and various regulations under the Moon administration.
Even if faults can be traced to the past government, the incumbent government is either impotent or negligent given it wasn’t able to fix it over the last four years. The government has trotted out 24 sets of real estate measures. But few were on supplies. Though the government proposed to create new suburban towns or develop idled plots of land in Seoul, it hardly appeased demand for good neighborhoods in inner Seoul.
The real estate market is a complete mess. Even experts are at a loss. The rent crisis triggered by the new laws aimed at protecting tenants has only deepened their anxieties and sent people to panic buying from apartments to other multi-residential housings. The panic has spilled over to outer Seoul. The government assures the market will regain clam by spring, but most institutions predict rent instability to last through next year.
The government feigned an apology, but has not recognized any fault over repeated failures in its housing policy. It only transferred the responsibility to the people for “bearing fantasy about apartments.” The public chants, “We do not ask for bread. We just want the government stop meddling with baking.” If the government wants to atone for the damage, it must first sack the person who pretends to be a baker.