In April 1950, Park Heon-young met Joseph Stalin in Moscow alongside Kim Il-sung, persuading him that if South Korea were invaded and Seoul captured, 200,000 underground members of the Workers' Party of Korea would rise up. However, his calculations proved wrong. After the invasion, North Korean forces remained in Seoul for three days, but the anticipated popular uprising never occurred.
The core groups that were supposed to lead the uprising had already been neutralized by the South Korean government. Public sentiment had also shifted away from communism. A key reason was the land reform implemented in South Korea just before the outbreak of the Korean War. With tenant farmers, who accounted for over 80% of the rural population, gaining ownership of their farmland, asset inequality decreased significantly. More importantly, most citizens were granted the right to shape their own lives. They were no longer people with nothing to lose. Once they had something to protect, they did not waver under the temptation of communism's promise of "free confiscation and free distribution."
Even now, more than 80 years after liberation, real estate remains at the center of South Korea's social conflicts. More precisely, it is apartments. Wage income growth has failed to keep pace with rising asset values. The gap between homeowners and non-homeowners has widened to a degree reminiscent of the divide between owner-cultivators and tenant farmers in the past, threatening even community cohesion. In particular, the sense of deprivation among young people fuels low birth rates and intergenerational conflict.
Apartments cannot be confiscated and redistributed like farmland in the past. The most intuitive solution is to increase supply. This approach enables non-homeowners to acquire affordable "homes" and enter the middle class.
However, the problem lies in apartments becoming targets for speculation driven by price appreciation. Simply expanding supply could instead create opportunities for gap investment, potentially exacerbating inequality. Tax and financial regulations introduced to prevent this have only repeated controversies over market distortion.
It is worth considering the introduction of "private permanent rental housing" as an alternative that preserves market functions while preventing housing investment from focusing solely on price gains. Under this model, companies, real estate investment trusts (REITs), pension funds, and others would supply new housing units and lease them for 50 years or more. By foregoing profits from sales, they can instead enjoy stable cash returns.
Tenants are guaranteed long-term residency rights. If reasonable criteria for rent increases are established, tenants can live stably without worrying about moving. This provides the same "stable foundation of life" that owner-cultivators once enjoyed. At the same time, if tenants invest in rental housing through REITs or similar vehicles, they indirectly own property and can partially hedge against rising rent burdens. This does not mean abandoning homeownership; rather, it diversifies the forms of ownership.
The reason a system prioritizing rental income over sales profits has not taken root is due to insufficient policy design. To attract private participation, tax incentives such as exemptions from holding taxes must be accompanied by mechanisms ensuring stable returns. On the other hand, to prevent deterioration in housing quality caused by inadequate maintenance or remodeling investments, strict national-level management and supervision standards are essential.
In fact, overseas examples show that pension funds and institutional investors often manage long-term rental housing as a core investment asset. For instance, Bouwinvest, a Dutch housing fund, owns and operates approximately 19,000 rental units in key urban areas including Amsterdam, The Hague, and Rotterdam as of the first half of 2025. While pursuing target returns in the range of 5.5% to 7.0% annually, it achieves a 99% occupancy rate and an impressive tenant satisfaction score of 7.6 out of 10. This demonstrates that housing can be sufficiently attractive as an investment even without being a target for speculation.
Land reform created "something to protect" for tenant farmers, fostering national unity. What we need is a "foundation of life" that is easily accessible and cannot be taken away. Changing the nature of housing assets from price-gain-focused to residential capital goods that generate stable cash flow—and granting rights to reside stably and participate in housing assets—represents a new meaning of "cultivators own their land."
in OPINION
