Not every owner of multiple homes is a speculator

The question, then, is not whether speculation should be controlled but where the government chooses to draw its political line.

Jang Deok-jin

The author is a professor of sociology at Seoul National University.

Owning two homes at some point in life is not necessarily unusual. Temporary or unintended multiple-home ownership often arises from family needs, work or inheritance rather than speculation. But in Korea's housing debate, anyone with more than one property is frequently viewed as a market disrupter.

Consider the case of one individual, A, who was born into a modest family and achieved financial stability through years of hard work. His parents spent their lives supporting their children. Even in their 80s, their housing remained unstable, as they still lived under a jeonse lease, Korea’s unique lump-sum deposit lease system.

Apartment complexes in Seoul are seen from the N Seoul Tower observatory on Jan. 25. After President Lee Jae Myung said at a New Year's press conference on Jan. 23 that he is “not considering at all” extending the temporary suspension of heavy capital gains taxes on owners of multiple homes, attention turned to whether some owners in regulated areas, including Seoul, will put properties on the market at discounted prices to avoid higher taxes. [YONHAP]

Concerned about their security, A decided to provide them with a permanent home. Since transferring the property to them directly would have triggered gift and inheritance taxes, he purchased a home in his own name and allowed his parents to live there comfortably. His story is one of parental sacrifice and filial duty. But by definition, A became a two-home owner. Should he be regarded as a speculative investor who is harming the market?

Another individual, B, underwent a somewhat similar experience. His daughter, diligent since childhood, secured a job at a major company. The achievement brought pride, but the daily commute soon became a burden, as the office was on the outskirts of Gyeonggi. From her parents’ home in Seoul, she had to wake before dawn, travel to Gangnam District and then ride a corporate shuttle for an hour and a half each way, meaning she spent three hours per day commuting. Additionally, the buses were often packed, and she was frequently exposed to illnesses. What began as recurring colds eventually led to annual hospitalizations for pneumonia.

After seeing his daughter hospitalized for the fourth time, B decided to prioritize her health. Setting aside tax concerns, he purchased a small apartment near her workplace. Securing a safer residence for his daughter made him a homeowner of two properties. Does this make him a speculator who is negatively affecting ordinary households?

Finally, C's parents passed away unexpectedly and left their home to their children. Because C already owned a residence, inheriting the property jointly with his sibling made him a multiple-home owner overnight.

C wanted to sell the property quickly to avoid higher property taxes and the loss of various tax benefits tied to single-home status. His sibling disagreed. Without a home of their own, his sibling preferred to hold the property in hopes that a price surge would allow them to sell the house for a life-changing sum.

Under joint ownership, the property could not be sold without both siblings' consent, so C had no choice but to bear heavy holding taxes and potential transaction costs. Should he be treated as a target of punitive taxation?

All three cases are drawn from real situations familiar to the author. They are not exceptional. People who have lived responsibly and complied with the law can suddenly be labeled speculators and face public criticism and significant tax burdens simply because they own more than one home.

There are ways to distinguish between genuine speculation and unavoidable circumstances. Real estate transactions in Korea are already closely tracked by government agencies. Authorities not only know the identity of every person who buys a property — including their reason for and the cost of the purchase — but they also have information on family trees, cohabitation status, inheritance history and patterns of ownership and sales.

As a result, they can identify whether a person has repeatedly traded properties for short-term gains or whether transactions occurred only when moving residences or responding to family needs, as well as how long properties are held and whether the owner has accumulated assets in areas where they do not live.

President Lee Jae Myung, center, listens to Deputy Prime Minister and Finance Minister Koo Yun-cheol, right, speak about the expiration of the temporary suspension of heavy capital gains taxes on owners of multiple homes during the fourth Cabinet meeting at the Blue House on Feb. 3. [JOINT PRESS CORPS]

Given the depth of administrative data available, the question is why this information is not used more effectively. In a country that prides itself on its digital prowess and now aims to become an AI powerhouse, advanced data analysis should be able to distinguish habitual speculators from ordinary households within seconds.

If AI were used to analyze these records, it could identify those who intentionally distort the market through repeated short-term trades and excessive accumulation. Targeting such actors with stronger enforcement would address speculation without penalizing households that are acting out of necessity.

A more precise approach would reduce unintended harm, stabilize the market and improve perceptions of fairness. Broad policies that treat all multiple-home owners alike risk creating resentment while failing to address the core problem. The question, then, is not whether speculation should be controlled but where the government chooses to draw its political line.

This article was originally written in Korean and translated by a bilingual reporter with the help of generative AI tools. It was then edited by a native English-speaking editor. All AI-assisted translations are reviewed and refined by our newsroom.