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| ▲ President Lee Jae Myung speaks during a Cabinet meeting at Cheong Wa Dae in Seoul on Jan. 27, 2026. (Yonhap) |
Lee-real estate market
Lee vows efforts to ease excessive capital inflow to real estate market
By Kim Eun-jung
SEOUL, Jan. 27 (Yonhap) -- President Lee Jae Myung vowed on Tuesday to ease excessive capital inflows into the real estate market, warning that the potential burst of asset bubbles could have far-reaching consequences on the broader economy.
Lee made the remarks during a Cabinet meeting, as the government considers measures to curb the overheated housing market, including ending tax breaks for owners of multiple homes and increasing housing supply in the Seoul metropolitan area.
"We must correct the distorted allocation of resources that is abnormally concentrated in the real estate market," Lee said. "Excessive expansion of a nonproductive real estate market inevitably fuels bubbles, which could undermine growth potential and deal a serious blow to the overall economy."
Lee said South Korea should learn from the painful experience of Japan's so-called "lost 30 years," referring to the prolonged economic stagnation that followed its inability to rein in a real estate bubble in the 1990s.
"To avoid such difficulties, (the government) must consistently and steadily push forward practical measures," he said. "We should not allow unfairness and abnormal practices to persist out of fear of pain or resistance now."
He reiterated his plan to end a temporary exemption on heavy capital gains taxes for owners of multiple homes when it expires on May 9, four years after it was introduced.
Currently, capital gains taxes on real estate sales range from 6 to 45 percent. Owners of two homes in designated speculative zones face an additional 20 percentage points, while those owning three homes are subject to a 30 percentage-point surcharge on top of the base rate.
Lee described the recent rally in the stock market as "a path toward normalization" and pledged continued efforts to overhaul regulations that weigh on financial markets to spur greater capital inflows.
"We will continue to improve unreasonable regulations that have burdened the market to accelerate the transition toward more productive financing," he said.
South Korea's main stock index reached a milestone Thursday by briefly topping the 5,000-point mark during intraday trading.
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