A newly introduced housing plan aimed at encouraging homeowners to purchase a second home in rural areas is sparking debate over its potential to reverse the decline in the rural population. The plan, outlined in the government’s 2024 economic policy directions, seeks to reduce the tax burden for homeowners in certain regions when they buy a second property in selected rural areas. While the plan has been met with mixed responses, experts agree that action is needed to address the demographic crisis in rural communities.
Rural areas in South Korea have been experiencing a rapid decline in population as young people flock to urban areas in search of better job opportunities and a higher quality of life. The risk of depopulation is particularly severe in 89 specific regions. In response to this crisis, the government hopes that incentivizing homeowners from cities like Seoul, Incheon, and parts of Gyeonggi Province to invest in second homes in rural areas will help revitalize these struggling communities.
According to Kim Je-kyung, a chief consultant at real estate agency Tumi, the plan could potentially encourage affordable homeowners from urban areas to spend more time in rural regions and contribute to the local economy. However, he also expressed concerns about the limited benefits of the plan, suggesting that the government should consider widening the scope of the tax benefits to attract more buyers.
While experts like Kwon Dae-jung, a real estate professor at Sogang University, generally have a positive view of the housing plan, they emphasize the need for careful implementation. Kwon suggests that the plan should prioritize saving villages and towns over major cities that are better equipped to withstand depopulation risks. He warns that without specific guidelines, people may exploit the plan for speculative purposes, acquiring second homes in major cities rather than rural areas.
Overall, the housing plan presents an opportunity to address the demographic crisis in rural communities. However, experts highlight the importance of considering the size of administrative districts and ensuring that the plan contributes to a balanced regional economy. With careful implementation, the plan has the potential to breathe new life into struggling rural areas and provide much-needed support to their shrinking populations.
As the government moves forward with this housing plan, it is essential to carefully consider the interests and needs of the rural communities, while also ensuring that the benefits are equitable and accessible to a wide range of homeowners. Through effective implementation and ongoing evaluation, South Korea can work towards reversing the alarming trend of rural population decline and create sustainable and thriving communities across the country.
