Seoul: The government announced new measures to regulate speculative home buying by foreigners in Seoul, Incheon, and key areas of Gyeonggi Province as part of efforts to curb speculative demand driven by overseas capital inflows.
According to Yonhap News Agency, the Ministry of Land, Infrastructure and Transport stated that the new restrictions, which subject foreign home buyers to the Real Estate Transaction Reporting Act, were approved during a meeting of the Central Urban Planning Committee. These regulations will come into effect on Tuesday and are set to last for one year, with the possibility of extension based on market conditions.
The Real Estate Transaction Reporting Act mandates that foreigners, foreign corporations, and foreign governments must obtain approval from local authorities before completing housing transactions in designated zones. The measure encompasses the entirety of Seoul, seven districts in Incheon, and 23 cities and counties in Gyeonggi Province. Transactions finalized without the necessary prior approval will be considered invalid.
Furthermore, approved foreign buyers are required to move into the purchased property within four months of receiving permission and must reside there for at least two years. Failure to adhere to these stipulations could result in corrective orders from local authorities within three months, and repeated non-compliance may lead to fines.
In instances where a transaction is suspected of involving foreign capital linked to money laundering, the case will be reported to the Financial Intelligence Unit, which is responsible for monitoring illegal financial activities under the Financial Services Commission.
First Vice Land Minister Lee Sang-kyeong emphasized that "the measure aims to block speculative demand fueled by foreign capital inflows and stabilize housing prices by preventing market disruption by foreign buyers."
According to ministry data, housing transactions by foreigners have shown a steady increase since 2022, with an average annual growth rate exceeding 26 percent. The government anticipates that this upward trend will persist throughout the year, raising concerns over speculative buying amid tightened domestic loan regulations.