Second, tax relief. The purpose is to normalize it according to the tax principle. In the capital gains tax sector, heavy transfer tax for multi-homeowners has been temporarily deferred (one year until May 9, 2023). In fact, this heavy duty system should be abolished. The existing general tax rate (6-45%) is so high that there is no justification for additional heavy taxation. Of course, there is an aspect that can induce a sale by setting a sunset time limit through grace, but ultimately, it should be utilized within a short time. The deadline for disposing of the previous housing for temporary two-family dwellers in the area subject to adjustment has been restored from one year to two years. It goes back to about 3 years ago. Since one year is too short a period of time, it is a desirable measure considering the rental period of the jeonse tenants, etc. Currently, the time limit for disposal of non-adjustable areas is three years. 국민은행 빠른조회
At the end of last year, a general real estate tax (special property tax) crisis occurred. It had already been foreseen. It has more than doubled since 2020. This time, the fair market value ratio of the property tax was lowered from 100% to 60%. That means a 40% discount on the tax base, which is reasonable. 이베이스매뉴얼
The apartment complex seen from Namsan in Seoul. Among the “New Government Economic Policy Directions” announced by the government on June 16, the real estate market normalization plan focuses on regulatory innovation and housing supply expansion. photo news 1
However, additional supplementation is needed in that the tax rate, which is the core cause of the problem, has not been lowered. The tax rate for multi-family dwellings must be adjusted as it has nearly doubled in 2021 compared to 2020. In addition, it is reasonable to exclude temporary two-homeowners, inherited houses, and local low-priced houses when determining single-homeowners (total in the table). The author argued that the standard of exemption of capital gains tax per household and one house should be applied equally to the same national tax, the property tax. It is essential in terms of legal stability and predictability. The standard for low-priced local housing is of interest, and the official price is expected to be around KRW300m. Currently, the standard for rural housing (hometown housing) is 200 million won, and this amount also needs to be adjusted upward. On the other hand, exceptions for housing rental companies that have been automatically canceled should also be considered. As it is not easy to sell due to current tenants, you should consider deferring until the end of the lease period.
The standard amount of non-taxable property for one homeowner is KRW 1.1 billion. In 2022, a special deduction of 300 million won will be temporarily deducted up to 1.4 billion won. In addition, a deferment of payment will be implemented for the elderly and long-term owners. The property tax rate was also lowered from 60% to 45% for only one homeowner per household. The core of the property tax improvement plan should be multi-family dwellers. The deduction limit is still at 600 million won, and the upper limit for tax burden is 300%. The tax rate is punitive. Resolving the problem from the perspective of multi-family dwellers is an urgent priority.
Third is the financial sector. It is a support for the formation of the residential ladder for end-users, such as the step-by-step normalization of loan regulations. For the first time in life, the upper limit of the mortgage loan ratio (LTV) will be eased to 80% regardless of region, house price, or income, and the loan limit will also be increased from 400 million won to 600 million won. This is a reasonable approach that reflects most of my arguments. However, if the loan limit of 600 million won is converted to 80%, the price of a house is only about 800 million won. Expansion of the limit should be further considered. The first house in life is meaningful in terms of housing stability, but it is also the most important childbirth measure. Comprehensive support from acquisition tax reduction and interest rates mentioned in the pledge should be provided.
The policy is to reflect future income when calculating DSR (Loan Principal Repayment Amount). As it has been applied continuously since the past, further improvements are needed to ensure that the benefits are sufficient. If the loan limit stays at an increase of about 30 million to 40 million won, it doesn’t mean much. Also, consider abolishing the limit on credit loans within the annual income range and expanding the limit, such as excluding DSR within the limit of 100 million won for emergency livelihood loans (main loan). As the loan system itself has been completely reorganized from a collateral-oriented to an income-oriented system, side effects must be minimized so that there is no disadvantage for each class. In particular, as the biggest victims of DSR are low-income families, they shouldn’t be kicking their housing ladder. In the process of reform, the ban on unnecessary loans should also be abolished. For example, a ban on loans during pre-sale for a pre-sale price exceeding 900 million won, and a ban on subsidized loans when a house price exceeds 1.5 billion won. In addition, the implementation of a relief loan (20 trillion won) for the common people, which replaces the main loan with a high interest rate and variable interest rate with a low interest rate, fixed interest rate, and a small loan with a low interest rate (up to 12 million won) will be expanded. This type of repayment loan has been provided temporarily in the past, but considering that the financial sector pays about 1,000 trillion won, the limit is too small and needs to be expanded.
Fourth, the cheonsei rental market is stabilized. The plan is to supply approximately 30,000 public rental units for construction, 10,000 units for purchase, and approximately 20,000 units for charter rental, scheduled for occupancy in June. A preemptive response plan will be prepared before the expiration of the contract renewal application rights in 2022 and the sequential arrival. When the housing market stabilizes, it is natural that the demand for jeonse with pending purchases increases. For the past two to three years, sales and jeonse prices have shown a trend that goes hand in hand. From the second half of the year, there may be a segregation phenomenon in which the rate of increase in the Jeonse price gradually increases. As the original solution is to expand supply, it must be pursued steadily. As the real estate market moves organically rather than defining one sector, comprehensive measures are essential.
As for real estate measures, it is urgent to normalize the market through deregulation. You have to unravel each field that is tangled like a skein of thread and put it back in place. The recent government release of 17 cities, counties, and gu from the overheated real estate speculation district, excluding Sejong City, is also interpreted as a countermeasure for this. The market is highly likely to contract in the second half of the year due to a rise in interest rates on loans. As such, it is imperative that prompt deregulation is needed to strengthen the market’s flexible responsiveness.