HomeAll NewsEducationTV
Equities & FundsCrypto & Digital AssetsAI & TechnologyBusiness & CorporateUS Politics & PolicyGeopolitics & Global RiskMacro, Rates & FXCommodities & EnergyEuropean Politics & MarketsAsia-PacificReal Estate & Property
Story archiveAll categories
← All Stories

Lee cites concerns S. Korea may be heading for real estate bubble like Japan's

Created at 23 Jul · 4:41 AM1 source↑ Market-relevant
IN SHORT

President Lee Jae Myung expressed concern over South Korea's substantial real estate investment, drawing parallels to Japan's 1990s market collapse. He emphasized stabilizing the market as a major challenge requiring social consensus.

✉Newsletter

PiQ Daily

Pick your topics. Get only what matters, on your cadence.

Key Numbers

1990sdecade of Japan's real estate market collapse
140participants in real estate policy discussion

Who's Involved

Lee Jae Myung
President of South Korea, concerned about real estate bubble
Han Seong-sook
Prime Minister of South Korea, attended policy discussion
Lee cites concerns S. Korea may be heading for real estate bubble like Japan's

↳ Why This Matters

The South Korean president's concerns highlight potential systemic risks in the nation's property market, drawing parallels to Japan's economic stagnation. Government plans to revise property taxes indicate a proactive approach to managing these risks, which could impact homeowners and the broader economy.

Key facts

  • President Lee Jae Myung voiced concerns about South Korea's real estate market potentially forming a bubble.
  • He drew parallels to Japan's real estate market collapse in the 1990s.
  • Lee highlighted South Korea's exceptionally high level of real estate investment.
  • Stabilizing the real estate market was identified as one of South Korea's biggest challenges.
  • The government is preparing to revise real estate taxes to curb rising home prices.

President Lee Jae Myung expressed concern on Thursday that South Korea's substantial investment in real estate could lead to a market bubble and subsequent collapse, similar to Japan's experience in the 1990s. Speaking at a public discussion on real estate policy, Lee noted that the country's real estate asset prices and investment share might be among the highest globally.

Lee referenced Japan's "lost 20 years" or "lost 30 years" following its market crash, stating that many people worry South Korea is heading towards a similar peak and that countermeasures are necessary. He emphasized that stabilizing the real estate market is one of the nation's biggest challenges and requires social consensus.

The discussion, which included approximately 140 participants from various sectors, comes as the government reportedly plans to announce revisions to property holding taxes as early as late July. A key aspect of the proposed tax revision involves setting a home price threshold for higher property holding taxes, aimed at cooling housing demand by increasing the tax burden on owners of high-value homes.

Frequently asked questions

President Lee expressed concern over the exceptionally massive investment in real estate and the possibility of heading towards a market bubble and subsequent collapse, similar to Japan's experience.

He compared it to Japan's real estate market collapse in the 1990s, which led to periods of economic stagnation referred to as the 'lost 20 years' or 'lost 30 years'.

The government is reportedly preparing to revise real estate taxes, specifically property holding taxes, to rein in runaway home prices and cool housing demand.

What Happens Next

01Government plans to announce revisions to property holding taxes.

Get the newsletter.

Pick the topics you actually care about. We'll email when there's news worth your time, on the cadence you choose. Cancel any time from your account.

Cadence

How It Developed

President Lee Jae Myung expressed concern over South Korea's real estate investment.
Lee cited Japan's 1990s real estate market collapse as a cautionary example.
He described stabilizing the real estate market as a significant challenge.
The government is reportedly planning to revise property holding taxes soon.
Sponsored

London Quick Take - 22 July - UK inflation softens, oil rises and chips rally ahead of Alphabet, Tesla earnings

SAXO

Sources

T1
Lee cites concerns S. Korea may be heading for real estate bubble like Japan'sYonhap News Agency

Related Stories

PulteGroup quarterly profit falls amid affordability pressures
22 Jul · 11:19 AM
UK house prices rose 2.7% in year to May, ONS data shows
22 Jul · 9:00 AM
Ritz-Carlton's Nepal entry signals possible oversupply of high-end hotels
22 Jul · 5:51 AM
Climate gentrification: How heatwaves are driving up house prices in Europe's suburbs
23 Jul · 5:11 AM
Homebuyers trapped in buyer representation agreements
22 Jul · 8:36 AM