Ex-Seoul mayor raps incumbent over real-estate policy

Former Seoul Mayor Oh Se-hoon, right, speaks during a broadcast on his YouTube channel, Dec. 29, 2019. YouTube capture

By Lee Kyung-min

Former Seoul Mayor Oh Se-hoon criticized sitting Mayor Park Won-soon for spiking housing prices, in what he said was a consequence of “failure to understand market principles,” Friday.

Park's misplaced priority on curbing speculation, Oh said, has fueled a continued increase of housing prices in Seoul, a policy that requires immediate correction to boost supply, meaning the city should build more housing.

Experts say, however, Oh's politically charged remarks seeking to court voters lack substance given he failed to mention the need to ease lending rules to lower borrowing costs for people who need homes.

On his YouTube channel, Oh appeared with a senior official of the Citizens' Coalition for Economic Justice, a civic group, to discuss Seoul's “unbridled” housing prices, Dec. 29, 2019.

“Empty land owned by the Seoul city including that in Samseong-dong, southern Seoul, formerly occupied by Seoul Medical Center, should be considered as a viable place to build housing to better meet demand,” Oh said during the 33-minute clip.

The city can build low-cost public housing facilities or apartments to meet the market demand, he added, by fully utilizing Seoul Housing & Communities Corp. a state-run land and housing developer.

“With resources and proper development plans from city-run organizations, the rising housing prices can be stabilized with the city government's policy discretions including the exclusive right to develop and change the use of Seoul's land,” he said.

The measures to boost supply are in contrast with the real estate policy by Park who said Jan. 2 that the city will create a fund to redistribute “undue” wealth amassed by a spike in housing prices.

This is in line with the central government's initiative to increase property taxes, mostly targeting owners of multiple homes ― often criticized as socialist-leaning policies disregarding market principles.

“Windfall gains collected by the city will be used to provide affordable housing and business venues to low-income and small businesses owners,” Mayor Park said at Sejong Center for the Performing Arts.

Conspicuous by their absence were plans to ease lending rules, which prospect homebuyers need most, according to Yonsei University economist Sung Tae-yoon.

“Both Oh and Park failed to clarify how they would revise lending rules to help those who need housing,” he said.

“There is not much city-owned land left, so deregulation to allow more construction is much more of a viable option.”