Seoul: President Lee Jae Myung has committed to implementing measures aimed at reducing excessive capital inflows into the real estate market, citing concerns over potential asset bubbles that could significantly impact the broader economy.

According to Yonhap News Agency, Lee made these comments during a Cabinet meeting, where the government is considering a range of strategies to cool the overheated housing market. These strategies include ending tax breaks for owners of multiple homes and increasing the housing supply in the Seoul metropolitan area. President Lee emphasized the need to correct the current resource allocation, which he described as disproportionately concentrated in the nonproductive real estate market.

Lee highlighted the lessons that South Korea should learn from Japan's prolonged economic stagnation, known as the "lost 30 years," due to its failure to manage a real estate bubble in the 1990s. He stressed the importance of implementing practical measures consistently to avoid similar economic challenges, and he urged that fear of resistance should not prevent necessary changes.

In line with his plans, Lee reiterated the government's intention to end the temporary exemption on heavy capital gains taxes for owners of multiple homes, which is set to expire on May 9. Currently, capital gains taxes on real estate sales range from 6 to 45 percent, with additional surcharges for owners of multiple homes in designated speculative zones.

Lee also noted the recent rally in the South Korean stock market as a positive step toward normalization. He vowed to continue efforts to reform regulations that hinder financial markets, aiming to promote greater capital inflows and more productive financing.

South Korea's main stock index recently achieved a significant milestone by briefly surpassing the 5,000-point mark during intraday trading, reflecting a positive trend in the country's financial markets.