Lee’s approval rating hits new low as housing, stock market turmoil overshadow diplomatic trip

President Lee Jae Myung and first lady Kim Hea Kyung wave to greeters after arriving at Seoul Air Base in Seongnam, Gyeonggi Province, Monday, following an 11-day diplomatic trip. Yonhap

President Lee Jae Myung convened a meeting on the housing and stock markets immediately after returning from an 11-day diplomatic trip Monday, scrambling to address domestic economic concerns that built up while he was away.

According to Cheong Wa Dae, the closed-door meeting was attended by Prime Minister Han Seong-sook and Deputy Prime Minister and Finance Minister Koo Yun-cheol, as well as relevant Cabinet ministers and senior presidential aides.

The session focused on follow-up measures from the public real estate policy forum Lee chaired on July 23 — the day before departing on his overseas trip — where he voiced concern over what he called outsized investments in real estate.

Before departing, Lee left the ministries to work out tax, financial and housing supply measures based on feedback from that forum, only returning to the issue himself on the day he landed.

Participants at Monday’s meeting reviewed those measures, along with the effectiveness of supplementary regulations introduced by financial authorities on July 31 to curb risks tied to single-stock leveraged exchange-traded funds (ETFs), and discussed whether further steps were needed.

During his absence, the very markets he had flagged as a concern grew more volatile, not less. Data from the Korea Real Estate Board showed Seoul apartment prices rose for a 76th consecutive week as of July 27, despite a series of tighter housing regulations implemented over the past year under Lee’s administration.

The benchmark KOSPI went on a roller-coaster ride over six trading days during Lee’s diplomatic trip, declining in four of the six sessions — including a more than 10 percent plunge in a single day — before rebounding more than 17 percent on July 31.

The market turbulence tested confidence in Lee’s efforts to shift household wealth away from real estate and into financial assets.

Declining public support

The market uncertainty has coincided with weakening public support for the president.

A Realmeter survey released Monday showed Lee’s approval rating fell for a third consecutive week to 45.9 percent, the lowest since he took office, while his disapproval rating rose to 50.5 percent, marking the first time negative evaluations exceeded 50 percent.

A separate National Barometer Survey (NBS), released July 30, showed Lee’s approval rating falling to 53 percent, down 2 percentage points from two weeks earlier and reaching the lowest level of his term so far as recorded by the survey. His disapproval rating rose 3 percentage points to 37 percent.

The Realmeter survey had a margin of error of plus or minus 2 percentage points at a 95 percent confidence level, while the NBS poll had a margin of error of plus or minus 3.1 percentage points at the same confidence level.

Realmeter attributed the decline to a combination of factors, including stock market turmoil, controversy surrounding leveraged ETFs and public unease over housing policy, as well as debate over constitutional amendments concerning presidential reelection.

The NBS suggested the decline was driven in part by growing public dissatisfaction with the administration’s housing policy. It said a majority of respondents, in a separate question, favored easing regulations on jeonse loans, contrary to the position Lee outlined during the July 23 public forum. Jeonse is a housing rental system in Korea in which the renter pays a massive deposit to the landlord.

Analysts said the numbers point to a widening gap between the president’s stated priorities and the public’s patience for them.

“The president may need to pursue financial market policies that are more responsive to market realities rather than pressing ahead with his current agenda,” said Jung Jae-hwan, a political science professor at Inha University.

A real estate expert, who spoke on condition of anonymity, voiced a similar view. “The president appears to be overly focused on shifting household wealth from real estate into financial markets without adequately taking market conditions into account,” the expert said.

“There’s little point in holding a public forum or an emergency meeting if he has already made up his mind and is unwilling to change course.”