Financial Services Commission (FSC) Chairman Lee Eok-won addressed President Lee Jae-myung's apartment transaction at a National Assembly Policy Committee hearing on the 29th, calling it a 'private transaction' and stating the Presidential Office explained it was conducted lawfully and transparently. The remarks came after Lawmaker Park Jun-tae of the People Power Party questioned a controversial transaction structure involving a 29 billion won sale price, 11.3 billion won deposit, and 17.7 billion won maximum mortgage amount. Lee declined to provide specific evaluation of the transaction method, stating he was not familiar with the details and that it appeared to be a mutually agreed arrangement. The exchange occurred during the Policy Committee's business report session, where lawmakers also raised concerns about housing market signals and supply issues.
FSC Chairman Declines Evaluation of Presidential Apartment Transaction Structure
Lawmaker Park Jun-tae questioned FSC Chairman Lee about the President's Bundang apartment transaction, which has generated market controversy due to its structure involving a 29 billion won sale price, 11.3 billion won jeonse deposit, and 17.7 billion won maximum mortgage amount. Lee responded that it was a private transaction and he was not familiar with the specific details as described.
When Park asked whether Lee recognized this as an acceptable transaction method, the Chairman stated: "It seems to be something mutually agreed upon, but I don't know well which part went how." Lee refrained from providing a concrete assessment of the transaction structure.
Park argued the transaction could send wrong signals to the market, citing Lee's recent remarks at a presidential discussion forum where he stated that "in a situation where supply is insufficient and market liquidity is abundant, releasing even a little bit of loans could stimulate the housing market and create a vicious cycle of price increases."
The lawmaker pointed to redevelopment and reconstruction regulations and market liquidity expansion as factors contributing to the current real estate market situation, asserting that the FSC Chairman should present opinions to the government for market normalization.
Lee Attributes Housing Supply Shortage to 2022-2023 Construction Decline
FSC Chairman Lee explained that the recent supply shortage in the Seoul metropolitan area resulted from reduced construction starts in the past. He stated: "When I said supply is insufficient, it's because looking at the statistics, construction starts in the Seoul metropolitan area dropped sharply in 2022 and 2023."
Lee provided specific figures, noting that while approximately 200,000 housing units are normally started annually, this number decreased to around 100,000 units during that period. He explained that the effects of reduced construction starts typically appear three years later, stating: "Because the effect of reduced construction starts usually appears after 3 years, there is an aspect where it leads to supply shortages like the present in 2025, 2026, and 2027."
FAQ
What did FSC Chairman Lee say about President Lee Jae-myung's apartment transaction?
FSC Chairman Lee Eok-won called it a "private transaction" at a National Assembly Policy Committee hearing on the 29th and stated the Presidential Office explained it was conducted lawfully and transparently. He declined to provide specific evaluation of the transaction method, which involved a 29 billion won sale price, 11.3 billion won deposit, and 17.7 billion won maximum mortgage amount.
Why did Lee Eok-won say housing supply is insufficient in the Seoul metropolitan area?
Lee explained that construction starts in the Seoul metropolitan area dropped sharply in 2022 and 2023, decreasing from the usual 200,000 housing units annually to around 100,000 units. He stated these construction reductions typically affect supply three years later, leading to shortages in 2025, 2026, and 2027.
