Conflict between the central government and Seoul Metropolitan Government is intensifying over housing supply at the Yongsan rail yard site, with disputes now expanding to the lifting of land transaction permit zones.
Seoul Mayor Oh Se-hoon has raised concerns about the adverse effects of the "October 15 Real Estate Measures," demanding the lifting of regulated zones—a move expected to deepen tensions with the government. Critics warn that while both sides share the goal of expanding urban housing supply, their differing positions on real estate regulations and candidate sites for development could negatively affect overall housing supply in Seoul.
On January 14, Mayor Oh wrote on social media: "The government must no longer ignore the side effects of the October 15 real estate measures. They claimed to promote housing stability, but reality is the opposite. They are choking actual homebuyers first."
He added: "Loan limits have been sharply reduced, and the expansion of regulated zones along with various restrictions have raised the threshold for the housing market to abnormal levels. As a result, transactions have frozen, and demand pushed out of the sales market has flooded into the jeonse market, but even that has dried up. Rather than alleviating housing instability, they have fueled it."
Mayor Oh revealed he had conveyed these concerns directly to Land, Infrastructure and Transport Minister Kim Yun-deok. "I recently met with the minister and clearly communicated this reality. Unfortunately, I could not find any government willingness to correct the side effects of the October 15 measures," he said. "While asking the city to cooperate in securing supply volume, they gave no clear answer on regulations that distort the market."
He continued: "The most ordinary and desperate dream of 'owning a home' is being trampled under the name of the October 15 measures," reiterating his request for regulatory easing.
The government maintains it is premature to lift land transaction permit zones in parts of Seoul as Mayor Oh has demanded. A Ministry of Land, Infrastructure and Transport official said last month: "It is difficult to conclude that the current market is stable, and we need to continue monitoring the situation." The ministry's position reportedly remains unchanged.
Tensions between the government and Seoul are also escalating over the Sewoon District redevelopment in Jongno-gu. Seoul has pushed back after the Korea Heritage Service recently moved to revise enforcement decrees restricting high-rise development near Jongmyo Shrine. The city criticized this as "excessive overlapping regulation that conflicts with existing urban planning systems." If the heritage agency's amendment takes effect, 38 districts including Jangwi District 15 are expected to be affected.
The ongoing confrontation over real estate regulations raises concerns about negative impacts on overall housing supply in Seoul. The Ministry of Land and Seoul have failed to narrow their differences over housing supply at Yongsan rail yard. Seoul maintains that approximately "6,000 units plus alpha" is appropriate given current infrastructure plans, while the ministry insists on increasing supply to more than 10,000 units. Regarding new housing supply candidate sites proposed by the government, Seoul has indicated it can agree to only about half of the locations.
Real estate experts warn that this standoff could become a negative factor for housing supply overall. "Even if the government unilaterally announces candidate sites for supply, it will ultimately fall through if Seoul and district governments do not cooperate," an industry official said. "If both sides remain in conflict, delays in supply volume and pace will be inevitable."
