Lee blames real estate speculation for housing woes, calls for more investment vehicles
Published: 01 Jul. 2025, 18:26
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- SARAH KIM
- [email protected]
![President Lee Jae Myung, right, speaks during a Cabinet meeting at the Yongsan presidential office in central Seoul on July 1. [JOINT PRESS CORPS]](https://koreajoongangdaily.joins.com/data/photo/2025/07/01/9b5bfcfb-cf07-46c3-b257-ecdcafb9b4e7.jpg)
President Lee Jae Myung, right, speaks during a Cabinet meeting at the Yongsan presidential office in central Seoul on July 1. [JOINT PRESS CORPS]
"Recently, there has been some confusion and chaos due to housing and real estate issues," Lee said during the meeting. "Since investment vehicles are limited to housing or real estate, it has increasingly become a means of investment or speculation, which has led to housing instability."
This marks Lee's first remarks on the issue since the recent surge in real estate prices in Seoul, and financial authorities tightened lending regulations last week.
On Friday, the Financial Services Commission introduced stricter lending restrictions, capping housing-backed loans at 600 million won ($442,000) regardless of property price or borrower income in the greater Seoul area and other designated regulatory zones.
"Fortunately, the stock market and financial market have recently normalized and alternative means of investment are gradually establishing themselves," Lee said, according to presidential spokesperson Kang Yu-jung at a press briefing. He called to "maintain this positive trend" regarding efforts to diversify investments.
Lee has generally evaded mentioning his real estate policy vision during his presidential campaign, as the issue drew much criticism during the liberal Moon Jae-in government. The Moon government's real estate policy penalized owners of multiple properties with higher taxes and discouraged purchases with stiffer loan regulations.
![President Lee Jae Myung, center, salutes the flag ahead of a Cabinet meeting at the Yongsan presidential office in central Seoul on July 1. [JOINT PRESS CORPS]](https://koreajoongangdaily.joins.com/data/photo/2025/07/01/06d81f9a-ffad-4270-a254-c9821f97f2dd.jpg)
President Lee Jae Myung, center, salutes the flag ahead of a Cabinet meeting at the Yongsan presidential office in central Seoul on July 1. [JOINT PRESS CORPS]
Lee further instructed the Ministry of National Defense to review the matter of what to do with the land returned by U.S. Forces Korea in northern Gyeonggi during the Cabinet meeting, according to the presidential office.
The development of the land returned from U.S. military bases is a long-awaited project for residents of border areas, with Gyeonggi eager to repurpose the returned land to stimulate the local economy.
The instructions could be construed as a step toward enabling the development of the returned land from the U.S. military, in keeping with a pledge made by Lee as a presidential candidate.
In May, Lee said during a campaign in Uijeongbu, Gyeonggi, regarding the returned land from the USFK, "Why don't we allow development by at least providing long-term leases?" He has advocated more active government support for such development.
During the meeting, Lee further instructed Cabinet members to "respect the National Assembly as much as possible."
Lee stressed that "Korea is a country of popular sovereignty, and popular sovereignty is expressed through directly elected power."
Lee called the National Assembly "an institution directly entrusted with power by the people," and stressed that "appointed power must respect elected power."
Lee appears to be distinguishing the balance of power between elected and appointed officials from the beginning of his administration, as he has stressed that his government will be one of popular sovereignty.
The remarks come amid much friction between the preceding Yoon Suk Yeol administration and a parliament led by the liberal Democratic Party (DP). The current Cabinet still comprises many ministers appointed in the Yoon administration. The current National Assembly is also led by the Lee-aligned DP, and a cooperative relationship between government and parliament would be more conducive to Lee's reform initiatives.
Lee will have a luncheon meeting with the leaders of five minor political parties on Thursday to explain state affairs and solicit their cooperation, the presidential office said, following a scheduled town hall meeting with the press.
BY SARAH KIM [[email protected]]
with the Korea JoongAng Daily
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