Housing Prices and the Flawed Redevelopment Legislation

The flawed legislation promotes housing demand, ultimately driving prices up instead of stabilizing them.

### The Impact of the Redevelopment and Reconstruction Promotion Act in Seoul
The rise in housing prices is driving the push for legislation, but the legislation itself is contributing to the price increase. The Redevelopment and Reconstruction Promotion Act aims to **loosen regulations and reduce procedures** to accelerate housing development in Seoul. Key elements include **increasing the floor area ratio to build more units**, with the remaining units available for sale to the general public, ultimately providing **significant income for association members**.

### Government's Role in Housing Supply and Price Stabilization
The government is currently facilitating special deals for individuals, which may lead to **increased demand for benefits** and create a **problematic cycle**. Despite proposing measures for reconstruction and redevelopment, the government's actions may not effectively **stabilize rising housing prices**. The head of SH Corporation is advocating for **low-priced apartment supplies** and **cost transparency**, but the overall impact of increasing supply in other areas has not been successful in **stabilizing housing prices**.

### The Flawed Approach to Housing Supply in Seoul
The current housing supply strategy in Seoul is criticized for trying to **control the market**, leading to a logical contradiction where the reconstruction and redevelopment promotion law is both a response to **rising house prices** and a factor in **driving them up**. The real issue is not a shortage of supply, but a **temporary surge in demand** caused by rising house prices. To effectively regulate the housing market, a policy that **addresses demand**, rather than one that **supports price increases**, is needed.

### Misunderstanding Demand and Housing Issues in Seoul
The demand for housing in Seoul is overstated, driven by **expectations of rising prices**, which, if reduced, could lead to **excess housing**. Many residents are struggling with **aging apartments**, highlighting the need for a transition to **newer buildings**. While redevelopment and reconstruction are possible, the process is **complex and cannot happen all at once**, leading to a cycle of **unfulfilled housing desires**.

### The Flawed Logic of Housing Demand and Prices
Housing prices are not stabilizing despite government efforts, as the measures focus only on **supply** while **demand remains fixed**. The belief that everyone wants to live in desirable areas like Gangnam is based on the **rising house prices**, not genuine demand. The government's approach to promoting demand through policies like the **Reconstruction and Redevelopment Demand Promotion Act** may be creating the **wrong supply** and raising questions about its **effectiveness**.

### The Flawed Logic Behind Housing Legislation: Demand vs. Supply
* 🏠 The current rise in housing prices is prompting legislation, yet it is the legislation itself that **exacerbates these price increases**.
* 📊 Director Lee Yeon-cheol highlights that the assumption that **increasing supply will stabilize housing prices** is fundamentally flawed, as what is truly needed are **homes with rising prices**.
* 🏗 The Redevelopment and Reconstruction Promotion Act aims to **loosen regulations to promote new construction**, but its effectiveness remains uncertain, as it primarily focuses on **reducing procedures**.
* 📈 Increasing the floor area ratio could allow for more construction, but this is seen as a **privilege** and could lead to **further price increases**, contradicting the goal of **stabilizing the market**.
* 💰 The government’s push for this law raises concerns about fairness, as it may lead to **concentrated benefits for certain individuals** while failing to address the **underlying demand issues**.
* 🔍 The belief that **increasing supply will stabilize prices** is a fallacy, as evidenced by historical examples where **price stabilization occurred without intervention**.
* 🏢 Instead of merely focusing on supply, there needs to be a policy that **regulates demand to prevent further price hikes and excess housing demand**.
* 📉 Ultimately, the logical structure of the current housing legislation is flawed, as it promotes **demand for rising prices** rather than addressing the **true housing needs of the community**.

공급 대책 쏟아내도 집값은 "절대 안잡힌다" 재건축·재개발 촉진법으로 규제 풀어주려는 정부, 과연 시장은 어떻게 바뀔까?

부동산에 대한 객관적인 시각, 정확한 이론으로 시장을 분석하고 현상을 설명합니다.

아파트 사이클 연구소 소장 이현철입니다.
아파트는 필수품이면서 투자상품입니다
주식이나 암호화폐등 전형적인 투자상품은 관심이 없는 사람은
끝까지 관심을 갖지 않아도 되고 관심이 없을수도 있습니다.
그래서 분위기가 과열될때에도 분위기에 휩쓸리지 않을수도 있게 되는 것이죠.

그런데 주택은 다릅니다. 피할수 없습니다.
매일 매일 접하면서 살아야 합니다. 그래서 주택시장이 과열되면
그동안 관심을 가지지 않아도 될것 같다가 어쩔수 없이 과열된 시장에
반 강제적으로 참여하게 됩니다. 

그래서 부동산 공부가 필요합니다.
[피하지 못할거면 즐겨라] 라는 말이 있습니다.
부동산은 피할수 없습니다. 관심을 갖지 않고 살다가 반드시
후회하는 상황을 맞닥뜨리게 됩니다.
그럴거면 공부를 해서 내가 시장을 응용하고 잘 대응할수 있게
만드는게 낫지 않을까 생각합니다.

그 과정에서 제가 조금이나마 도움이 되었으면 합니다
부동산에 대한 객관적인 시각으로
부동산에 대한 좀더 정확한 이론으로
시장을 분석하고 현상을 설명하고자 합니다

많은 관심과 참여 바랍니다

- 비즈니스 협업 문의 : hoktal1@us-all.co.kr