[비즈한국] With the early presidential election approaching on June 3, candidates are putting forward real estate policies as core campaign pledges. Slogans such as ‘expansion of supply,’ ‘deregulation,’ ‘normalization of taxes,’ and ‘support for youth and the elderly’ are competitively emerging. However, the response from the market and the public remains cold. Cynicism, characterized by the belief that “it will eventually just be words again this time,” is dominant.
Why does trust in real estate promises fade as they are repeated? Let’s organize the major real estate promises mentioned by the presidential candidates so far, compare them with past failures, and think about practical alternatives together.
Let’s start by checking past cases of failed real estate promises.
The Moon Jae-in administration (2017-2022) made real estate policy a core task of governance. During his candidacy, he promised to “curb housing prices,” and after taking office, he introduced a series of strong demand-suppression policies such as the August 2, September 13, and December 16 measures. However, the median price of apartments in Seoul nearly doubled during his term. The combination of supply shortages and one-sided regulatory policies actually exacerbated market distortions.
The Park Geun-hye administration (2013-2017) promised ‘real estate normalization’ but was held back by concerns over economic stagnation. Initially, it attempted to stimulate transactions through deregulation, but it focused solely on demand recovery and failed to manage the jeonse (lump-sum deposit rental) market, leading to a ‘jeonse crisis.’
The Lee Myung-bak administration (2008-2013) put forward ‘half-price apartments’ as its signature campaign promise, but it could not be realized due to the deteriorating finances of the LH (Korea Land and Housing Corporation), failure to secure sites, and the alienation of actual homebuyers. It is a representative case where supply promises remained mere slogans.
The Roh Moo-hyun administration (2003-2008) also declared the ‘eradication of real estate speculation,’ but could not prevent the surge in apartment prices in the Gangnam area of Seoul. While it strengthened tax policies such as the establishment of the Comprehensive Real Estate Tax, it failed to properly manage market demand, failing to achieve practical housing price stability.
Ultimately, while past administrations declared ‘strong will’ in their real estate promises, they were consistently frustrated by walls such as supply shortages, policy confusion, market backlash, and a failure to reflect social structural changes.
Let’s summarize the reasons why past real estate promises were not implemented.
First, the exaggeration of supply targets and the lack of execution capacity.
Past administrations promised large-scale housing supply of ‘1 million units,’ ‘1.5 million units,’ and ‘2.5 million units,’ but in reality, they failed to meet targets due to practical constraints such as land acquisition, financing, and lack of project feasibility. For example, there were large-scale public rental housing promises, such as the Roh Moo-hyun administration’s 1 million units, the Lee Myung-bak administration’s 1.5 million units, and the Park Geun-hye administration’s 200,000 ‘Happy Housing’ units, but it was rare for these promises to be 100% fulfilled due to massive cost burdens and the financial deterioration of public agencies like LH.
Second, the unrealizability of populist promises such as ‘half-price apartments.’
The Lee Myung-bak administration promised to supply ‘half-price apartments’ in high-priced areas like Seoul, but in reality, the sale price was adjusted upward to 70–80% of the market value due to rising land compensation costs, construction costs, and funding shortages. It was not properly realized outside of pilot districts (Gangnam Segok, Seocho Umyeon), and the large-scale supply actually triggered a surge in jeonse prices and a downturn in the housing market.
Third, controversies over the feasibility of public rental housing and basic housing.
Doubts were raised regarding the feasibility of public rental expansion promises, such as ‘1 million basic housing units’ proposed in recent presidential elections, due to a lack of concrete implementation plans regarding site acquisition, financing, and project feasibility. For instance, considering that the total supply volume of the 3rd new towns is 350,000 units, it was pointed out that securing land for 1 million units in the metropolitan area is virtually impossible.
Fourth, the disconnection from the market and the side effects of regulation-only policies.
The Moon Jae-in administration introduced real estate measures 29 times but failed to stabilize housing prices. As the government intervened excessively in the market and strengthened regulations such as the Lease Protection Act, side effects occurred, including shrinking supply, skyrocketing jeonse prices, and a freeze in transactions.
Fifth, insufficient concrete implementation plans and financial measures.
Improvements in public rental housing quality and incentives for private rentals were also criticized for lacking detailed implementation plans or fiscal planning. For example, tax reduction benefits were often promised without specific details on how the reductions would be applied.
Ultimately, repeated failures—the realistic limitations of large-scale supply promises, the inability to realize populist pledges, the absence of concrete implementation and financial measures, the failure of regulation-only policies disconnected from the market, and long-term fiscal burdens and lack of execution capacity regarding public rental housing—have led to voters’ distrust in policies.
If so, for the sake of trustworthy real estate policy, I hope for the following types of promises in this presidential election.
First, securing the ‘feasibility’ of supply expansion. Realistic supply targets should be presented, and concrete implementation plans including land acquisition, licensing, and financing should be disclosed. Urban high-density development and increases in floor area ratios must be accompanied by communication and consensus with local communities and the expansion of infrastructure.
Second, a balance between regulation and market functions. A policy must be designed that harmonizes the curbing of speculation, the protection of actual homebuyers, and the market’s autonomous supply function. Policies designed solely for the sake of regulation, such as the Rebuilding Excess Profit Recovery System, the two lease laws, the price ceiling on new apartments, and the land transaction permit system, should be abolished and firmly prevented from ever being revived.
Third, an approach based on a long-term ‘hundred-year plan.’ Rather than election-oriented policies obsessed with short-term results, a long-term roadmap is needed, such as increasing the ratio of public rental housing (targeting at least 20%) and introducing a housing insurance system. Designing and legislating policies that can be pursued consistently regardless of regime change is crucial.
Real estate policy is a complex challenge that cannot be solved in a short period. It is difficult to gain market trust with only the slogans of ‘supply expansion’ and ‘deregulation’ repeated every election season. Achievable goals, concrete implementation plans, a long-term perspective, communication with the market, and the assurance of policy consistency are the real estate promises that candidates must present in this presidential election.
Kim Hak-ryul, head of the Smart Tube Real Estate Research Institute and famous by his pen name ‘Pashong,’ is a former head of the Real Estate Research Division at the Korea Gallup Research Institute. He runs and hosts the Naver blog ‘Pashong’s World Exploration’ and the YouTube channel ‘Stube TV.’ His books include ‘The Power of Gyeonggi-do Real Estate (2024),’ ‘The Absolute Principles of Seoul Real Estate (2023),’ ‘The Future of Incheon Real Estate (2022),’ ‘Kim Hak-ryul’s Absolute Principles of Real Estate Investment (2022),’ ‘The Future Map of South Korea Real Estate (2021),’ ‘From Now On, Only Places That Will Rise, Rise (2020),’ and ‘South Korea Real Estate User Manual (2020).’