Ruling Party 'Voices' Undermine President Lee's Resolve to Normalize Real Estate Market

Citing the 2028 Election, Some Call for Further CRHT Relief
Cheong Wa Dae Resists Easing That Would Undermine Owner-Occupancy Principle
Calls Persist Despite Government's Earlier Concession
Opposition Within Ruling Party Raises Fears of Policy Co

President Lee Jae-myung is pushing hard to normalize the real estate market, but repeated calls by some Democratic Party of Korea lawmakers to ease the comprehensive real estate holding tax (CREHT) are weighing on the government’s efforts to advance its policies. In particular, voices inside and outside Cheong Wa Dae warn that the calls could undermine policy consistency by weakening even the government’s core principle of applying tax benefits differently depending on whether a property is owner-occupied. Cheong Wa Dae is wary of the situation being seen as a disagreement between the ruling party and the government. Its position is that this is a time to maintain the existing policy stance and remain patient until measures such as expanded housing supply begin to yield results.

President Lee Jae-myung speaks during a Cabinet meeting at Cheong Wa Dae on Nov. 10, 2026. Yonhap News

According to Cheong Wa Dae on Nov. 11, President Lee has recently been issuing daily messages calling for an end to real estate speculation and illegal activities. At a Cabinet meeting the previous day, he stressed, “We must respond firmly so that people recognize that those who engage in structural unfairness and corruption involving rule-breaking and privilege, such as illegal real estate activities and local endemic corruption, will be caught and ruined.” He also referred to so-called “holdout tactics” that obstruct redevelopment projects, apparently targeting Pastor Jeon Kwang-hoon’s Sarang Jeil Church, and ordered a nationwide survey of the situation.

Earlier, on Nov. 3, he reaffirmed his determination to break the myth that real estate prices never fall, saying on social media, “Escaping the ruinous republic of real estate speculation is more important than the fate of the administration.” On Nov. 4, at the site of the public redevelopment project in Jangwi District 9 in Seongbuk-gu, Seoul, he named stabilizing housing prices in the Seoul metropolitan area as the top priority and called for shorter administrative procedures for redevelopment projects and increased housing supply. He once again underscored his intention to normalize the market by curbing speculative demand while easing bottlenecks in housing supply.

Despite President Lee’s strong determination, some lawmakers in the ruling party have called on the government to cut taxes, arguing that a higher property holding tax burden next year could become a liability in the 2028 general elections. Park Sung-joon, chief spokesperson for the Democratic Party of Korea, said after a high-level meeting between the ruling party and the government on Nov. 8 that Secretary-General Han Jeong-ae and others had strongly urged the government to set the CREHT basic deduction at KRW 1.4 billion for all single-home owners, regardless of whether they live in the property. Park also made clear that public sentiment in Seoul should be taken into account, saying, “The property tax and the CREHT are directly linked to the 2028 general elections.” Kim Young-bae, head of the Democratic Party’s Seoul City chapter, reiterated the same demand on Nov. 9 and set the fourth week of November as the deadline for consultations between the party and the government.

The problem is that the demands from some ruling party lawmakers run counter to the government’s fundamental principles for tax reform. In August, the government announced a plan to raise the CREHT basic deduction for owner-occupied single-home owners from KRW 1.2 billion to KRW 1.4 billion, based on the officially assessed property value, while lowering it to KRW 900 million for single-home owners who do not live in their properties. However, after some opposition within the ruling party, the government finalized a revised plan in September that kept the deduction for non-owner-occupied homes at KRW 1.2 billion. The party is now seeking further tax relief despite already having secured a compromise once.

If these demands are accepted, the difference in the basic deduction for owner-occupied and non-owner-occupied single-home owners will disappear. Separate tax deductions based on length of residence will remain, but the government’s policy of favoring owner-occupancy would inevitably lose much of its force. This is not simply a matter of raising the deduction by KRW 200 million; it is a major issue that goes to the heart of the tax reform’s purpose of distinguishing homeownership for residential purposes from ownership for investment purposes.

Cheong Wa Dae is wary of interpreting some ruling party lawmakers’ policy proposals as a disagreement among the party, the government, and the presidential office, and is reluctant to consider further tax relief. The CREHT was not on the official agenda of the high-level party-government meeting in August, but was suddenly brought to the fore. The government has also already accommodated the ruling party’s demands once. As a result, the prevailing view inside Cheong Wa Dae is that this is a time when policy consistency and patience are needed. A Cheong Wa Dae official said, “The current view is that expressions of opinion reflecting local public sentiment should be distinguished from changes to the government’s policy stance.” A key ruling bloc official said, “Making exceptions to address blind spots and uniformly lowering the tax burden for all non-owner-occupied single-home owners are separate issues,” adding, “We must not undermine the fundamental principles of the policy.”

Kim Min-seok, leader of the Democratic Party of Korea, speaks at a Supreme Council meeting at the National Assembly on Nov. 6, 2026. Yonhap News Agency

Some within the ruling party have also voiced concern about calls that could increase uncertainty surrounding the Lee Jae-myung administration’s real estate policies. On Nov. 10, Democratic Party Supreme Council member Choi Min-hee wrote on Facebook, “I oppose raising the CREHT threshold for non-owner-occupied homes to KRW 1.4 billion—in other words, a tax cut for the wealthy—and a retreat from reform.” Assemblyman Park Joo-min also said on SBS Radio’s “Kim Tae-hyun’s Political Show” that the government’s decision had been made after extensive discussion, and that further easing of the CREHT should therefore be approached with caution. Floor spokesperson Kim Seong-hoe explained that calls to ease the CREHT had not been conveyed as the party’s official position.

This content was produced with the assistance of AI translation services.