President Lee Jae-myung faces criticism over apartment sale mortgage

Opposition parties in South Korea have sharply criticized President Lee Jae-myung's recent apartment sale, accusing him of using a "shrewd tactic" to bypass loan regulations. Lee reportedly set up a 1.77 billion won mortgage on the property with the buyers as debtors, a move critics claim allowed him to profit significantly by circumventing strict lending rules.

"It's utterly bizarre. They demonize even 'gap investment' as speculation while strictly regulating loans, yet he sold his house on credit," said Jung Jin-suk, floor leader of the People Power Party. He alleged that Lee used "a cunning method to bypass loan regulations through private finance, making billions in profit."

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It's utterly bizarre. They demonize even 'gap investment' as speculation while strictly regulating loans, yet he sold his house on credit. It's a cunning method to bypass loan regulations through private finance, making billions in profit.

Lee Jun-seok, leader of the Reform Party, questioned the nature of the transaction, asking, "Why did he find a buyer with such complicated conditions? Is it a close acquaintance?" He highlighted that ordinary citizens face significant hurdles in obtaining loans while others seemingly find ways around them.

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Why did he find a buyer with such complicated conditions? Is it a close acquaintance?

Real estate experts acknowledge that while the seller deferring payment and setting up a mortgage isn't illegal or unethical, it's an uncommon practice. This type of deal typically involves the buyer using short-term loans, suggesting a potential personal connection between the parties. One expert noted it's not a way to "circumvent loan regulations," but acknowledged that such private, large debts used for property purchases could attract scrutiny from tax authorities.

The presidential office responded by stating the sale was conducted through a real estate agency in a standard manner. They asserted that the mortgage was a transparent civil agreement between the parties and vehemently denied any private relationship or special ties with the buyers. The office added that the apartment was Lee's only home, where he and his wife had lived for 28 years, and that he sold it below market value, foregoing potential profits from redevelopment to demonstrate a commitment to stabilizing the real estate market.

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The mortgage was a transparent civil agreement between the parties. The claim of a private relationship or special ties with the buyers is baseless.