Korea tightens rules on foreign property speculation

Dec 09, 2025, 08:44 am

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A view of a cluster of apartment buildings in Seoul. / Source: Yonhap News

The Ministry of Land, Infrastructure and Transport will expand reporting requirements and make funding reviews more stringent to block speculative real estate purchases by foreigners, including mandatory submission of financing plans for foreign buyers seeking homes in land transaction permit zones.

The ministry said on December 9 that a revised enforcement decree of the Real Estate Transaction Reporting Act reflecting these measures was promulgated the same day and will take effect on February 10 next year.

Earlier, on August 21, the ministry designated key areas in the Seoul metropolitan region as land transaction permit zones to curb speculative home buying by foreigners. Since August 26, foreigners have been allowed to purchase homes in these zones only if they can live in the property as their actual residence for two years after acquisition.

Since the system took effect, home purchases by foreigners have shown a clear downward trend. In the September–November 2025 period, foreign housing transactions in the greater Seoul area fell 40 percent from a year earlier, from 1,793 to 1,080 cases. Transactions classified as purchases by nonresident foreigners through “designated management agents” plunged 98 percent in the same period, from 56 to just 1 case.

To scrutinize foreign transactions more closely, the government will add “immigration status” and “address and whether the person has resided for at least 183 days” to the list of items that must be reported. The ministry expects this to help it quickly detect and block illegal activities such as unlicensed rental business and tax evasion, and to more promptly verify whether designated management agents have been properly reported.

In particular, foreign buyers acquiring homes in land transaction permit zones will be required to submit detailed financing plans and supporting documentation. These plans must specify not only the scale of overseas loans and deposits and the names of foreign financial institutions, but also domestic funding sources such as whether the buyer is taking over an existing lease deposit or using business-purpose loans. The ministry believes this will enable faster and clearer investigations into market-distorting behavior and tax evasion.

To prepare for the expanded reporting obligations, the ministry is overhauling both the Real Estate Transaction Management System (RTMS) and the electronic contract platform. System upgrades are to be completed within this month so that online reporting can begin immediately when the revised decree takes effect.

Park Jun-hyung, director-general for land policy at the ministry, said, “With this amendment to the enforcement decree, we have laid the institutional groundwork to prevent speculative real estate deals by foreigners. Building on this, we will move preemptively to curb speculative behavior by foreign buyers, establish a transaction order centered on genuine end-users, and contribute to stabilizing housing prices.”

#foreign property speculation #real estate regulation #land transaction permit zones #funding source review #Ministry of Land Infrastructure and Transport