As foreign ownership in the Korean real estate market rises to record levels, the Seoul city government announced new measures on Sunday aimed at increasing oversight of property transactions by non-Korean buyers, citing concerns over market distortion and unequal treatment of domestic residents.
Under the plan, city officials will begin scrutinizing the sources of funding in foreign real estate deals and expand investigations into irregular transactions flagged by the Ministry of Land, Infrastructure and Transport. The city will also conduct field inspections to verify whether foreign buyers are residing in properties purchased in “land transaction permit zones,” where buyers must agree to use homes for their stated purposes.
The measures mark one of the most aggressive steps yet by a Korean municipality to regulate a segment of the housing market that has so far operated with few restrictions. Officials said the initiative is intended to address growing frustration among Korean residents who face strict lending rules and high housing prices, while foreigners ? particularly those financing purchases from overseas ? are seen as operating under a looser regulatory framework.
“Transparency is critical,” a Seoul official said in a statement. “We are concerned about the possibility of illegal fund inflows, opaque transactions and unfair advantages that foreign buyers may have in the current system.”
As of late 2024, 98,581 foreigners owned 100,216 homes nationwide, including roughly 23,700 in Seoul ? nearly one in four of all foreign-owned residential units in the country. Foreigners also hold more than 66,199 acres of land, an increase of 1.2 percent from the previous year.
The city’s crackdown follows a broader international trend. Australia, for example, banned foreign nationals from purchasing existing homes for two years beginning in April, amid similar concerns over housing affordability and speculative buying.
In contrast, Korea has imposed few limitations, prompting calls for reform. City officials noted that foreigners can often circumvent domestic lending restrictions by securing mortgages abroad, raising further questions of fairness.
The new policy will include the collection of monthly transaction data from Seoul’s district offices and closer coordination with the Land Ministry. Officials said they will examine submitted documentation, including financing plans and proof of visa status, to identify suspicious behavior.
Buyers found to have violated residency or usage rules in restricted zones may face correction orders. If they fail to comply, the city could impose fines of up to 10 percent of a property's acquisition cost, as permitted under current law.
The city also formally asked the central government earlier this month to amend existing legislation governing foreign property purchases. While awaiting action, Seoul plans to move forward with its own enforcement.
Speaking at a city council meeting on Wednesday, Seoul Mayor Oh Se-hoon said that the city was closely watching price trends.
“If we see abnormal spikes in real estate prices and determine that foreign buying plays a part, then we must act,” he said.