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Foreigners must get approval to buy property in capital region
Apartments in Seoul are seen from atop Mount Nam, Thursday. Yonhap
By Ko Dong-hwan
The government announced Thursday that all foreign buyers — individuals, companies and government entities — must obtain local government approval before purchasing property in Seoul, seven districts in Incheon and 23 cities and counties in Gyeonggi Province.
The move is aimed at curbing speculative real estate transactions and protecting market stability.
The Central Urban Planning Committee of the Ministry of Land, Infrastructure and Transport passed the mandate under the Act on Report on Real Estate Transactions. It takes effect Tuesday and will remain in force for one year, with a possible extension.
Under the new mandate, approved buyers must move in within four months of receiving approval and reside there for at least two years. For properties that violate the law, local authorities will issue a warning, and if a second violation occurs, a fine of up to one-tenth of the property’s transaction price may be imposed multiple times.
The new law also requires foreign nationals seeking to purchase property in the designated zones to submit a financing plan and disclose the source of their funds and their visa type. Previously, this requirement applied only to the country’s speculation-prone zones.
The government said it will conduct stricter monitoring even after a property is purchased. For foreign-owned properties suspected of being linked to money laundering, authorities will report the cases to the relevant Financial Intelligence Unit abroad. If a purchase requires tax reporting to the foreign owner’s home country, authorities will notify that country through the National Tax Service.
“This measure is to prevent foreigners’ speculation on our land using foreign money, which disrupts the country’s real estate market," First Vice Land Minister Lee Sang-kyeong said.
Residential property purchases by foreign nationals in the country’s capital region have been rising since 2022. The number of transactions increased to 7,296 last year from 4,568 in 2022. By the end of July this year, the figure had already surpassed 4,430, mostly in Gyeonggi Province, reflecting an annual growth rate of 26 percent year-on-year.
The government said the upward trend is expected to continue throughout the year, heightening concerns about speculative buying amid tighter domestic loan regulations.
The government said that foreign nationals without a registered address in Korea who purchase property often commission an entrusted manager to oversee it, noting that such properties are mostly bought for speculation. Authorities reported that there were 295 such properties last year and predicted the number will be higher this year.