Concerns about the nomineeWhat attracts our attention in the government’s reshuffle on Friday of four ministers was the replacement of Land, Infrastructure and Transport Minister Kim Hyun-mee. She was not replaced for her blunders on real estate policy, the Blue House claimed. Whatever. It was a right decision nonetheless. Kim cannot avoid responsibility for soaring real estate prices even after her 24 sets of policies to control housing prices.
However, concerns are growing about her replacement, Byeon Chang-heum, former CEO of the state-owned Korea Land and Housing Corporation (LH), ahead of his confirmation hearing. Many experts wonder about his ability to tackle the real estate problem given his ideology. Some analysts forecast even tougher regulations on the real estate market than under Kim.
Such worries come from his past remarks. When appearing at a questioning session at the National Assembly in August, when he was head of the LH, he gave higher scores to the housing policy of the Moon Jae-in administration than to those of the two conservative administrations. Even as chief of a public corporation at the time, his views were very difficult to accept given the higher apartment prices in Seoul after the launch of the Moon administration three years ago.
In the past, he argued that soaring prices did not result from housing shortages and that eased regulations on redevelopment by past governments caused housing prices to rise. He supported a drastic extension of a mandatory lease term to three years plus three from the previous two years. Due to such a hardline position, he earned the reputation of being an “avatar of former Blue House policy chief Kim Soo-hyun,” the architect of the Moon administration’s real estate policy.
If Byeon sticks to such policies, we cannot expect any meaningful turnaround in the government’s real estate policy. If the government adheres to suppressing demand instead of increasing supplies while attributing real estate price hikes to speculators, it can never solve the conundrum.
Fortunately, Byeon mentioned the need to increase housing supplies in central Seoul after his nomination. But he is still known to favor the public concept of housing. We hope his background as an expert in housing policy can help him communicate with the market and ease the agonies of the people without homes.
The government must start over. Otherwise, people will laugh at the president’s continuing confidence that his administration can resolve real estate problems once and for all.