The government on Thursday unveiled a housing supply plan centered on building 230,000-plus units in the Greater Seoul area. The announcement came 10 days after the government released a tax reform package targeting ultra-luxury properties, non-owner-occupied homes and multi-home owners. With the latest measures signaling a push to accelerate supply, attention is now focused on whether they can stabilize the jeonse and monthly rent market as well as home sales.
Kim Je-kyung, director of Tumi Real Estate Consulting, said the measures were problematic because they prioritized strengthening owner-occupancy requirements over actual supply. "Because the tax burden will increase for those who do not sell by 2027, jeonse and monthly rent will disappear after next year," Kim said.
Kim added that the housing and rental markets are inherently linked. "You can choose whether or not to invest in shares, but you still have to live somewhere even if you don't buy a home," he said. "That is why the sales market and the jeonse and monthly rent market are so closely connected."
Kim also warned that young people with high incomes but no assets would in effect be shut out of public rental housing benefits, as income-based eligibility rules exclude them from residential support programs. "Middle-class households that fall in between are in serious trouble," he said.
Kim also shared his outlook on homeownership prospects for those without property and his broader forecast for home prices. His full analysis is available in the video above. More details can be heard in person at Herald Money Festa, to be held Oct. 2 and 3 at Dongdaemun Design Plaza in Seoul.
yjsung@heraldcorp.com
