Seoul housing prices have risen an average of 9.6% a year since the Lee Jae-myung administration took office, exceeding the 7.9% annual gain recorded under the Moon Jae-in administration and marking the highest pace of any South Korean government. The figures, however, are a simple comparison of price changes during each administration's term and should be read alongside market conditions such as interest rates, liquidity, the business cycle and housing supply and demand.
According to data obtained from the National Assembly Budget Office by the office of Rep. Choi Eun-seok of the People Power Party on the 2nd, the average annual increase in Seoul home purchase prices since the Lee administration took office came to 9.6%. That tops the 7.3% under the Roh Moo-hyun administration, 0.4% under Lee Myung-bak, 1.9% under Park Geun-hye, 7.9% under Moon Jae-in and minus 0.9% under Yoon Suk Yeol.
The analysis compared prices at the start and end of each administration's term using KB Kookmin Bank's home purchase price index, then annualized the results. It covered not only apartments but also low-rise multi-unit housing and detached and multi-family homes.
The increase in Seoul stood out against the national figure. During the Lee administration, the average annual rise in Seoul home purchase prices of 9.6% was more than 3.5 times the national rate of 2.7%.
The budget office stressed, however, that price movements under each administration do not indicate the effects of that government's policies. Because home prices are shaped by factors including interest rates, liquidity, the business cycle, housing supply and demand and market expectations, caution is needed in linking each administration's rate of increase directly to policy performance, it said.
Since taking office in May last year, the Lee administration has rolled out eight housing policy packages — ranging from lending curbs and an expansion of regulated zones to increased housing supply and more public housing — in an all-out push to rein in Seoul home prices.
In June last year, it reduced the total volume of household lending, centered on the greater Seoul area, and restricted mortgage loans taken out by multiple-home owners to buy additional homes. In September of the same year, it announced a supply expansion plan to begin construction on 1.35 million homes in the greater Seoul area by 2030.
In October, it expanded regulated zones to all of Seoul and 12 areas in Gyeonggi Province and set differing mortgage limits based on home prices.
This year, it has announced a series of supply measures, including expanding supply by using idle urban sites and relocated facilities, shortening the time to break ground on public land and speeding up redevelopment and rebuilding projects. On the 21st of last month, it unveiled a housing stability plan to supply 1.19 million public homes by 2030, including 920,000 in the greater Seoul area, and to introduce 190,000 universal public rental units.
