As the government and financial sectors began to regulate due to overheating of real estate speculation, the Chinese people filled the gap.
It was revealed that a Chinese in their 30s entered Korea for the purpose of studying abroad, purchased 8 apartments nationwide, and received a high monthly rent.
According to the data submitted by the Office of the People’s Power of the People’s Power, Kim Seong-won from the Ministry of Land, Infrastructure and Transport and released on the 16th, the foreign real estate transaction volume last year was 26,896 (about 11,2409 billion won).
Previously, the current status of foreign real estate transactions in Korea was 21,452 cases in 2016, 2441 cases in 2017, 26,422 cases in 2018, and 23,933 cases in 2019. However, last year, when the government’s real estate measures against speculators in Korea were poured out, it turned to a rebound.
Of all foreigners’ domestic real estate transactions, 51.3% (13,7888) were Chinese. Chinese real estate transactions rose 79.2% in four years from 7694 in 2016 to 13,788 last year.
Most of the Chinese transactions were concentrated in the metropolitan area (1,793 cases). They also intensively invested in the southwestern regions of Guro-gu, Geumcheon-gu, Yeongdeungpo-gu, and Gangseo-gu in Seoul.
Experts believe that as the government’s regulations on real estate loans to their own citizens have been strengthened, foreigners with relatively free financing have increased their speculative real estate transactions.
In fact, if a foreigner borrows money from their own financial institution to buy a domestic apartment, the loan regulation does not apply. Unlike Koreans, it is difficult to identify families, making it difficult to regulate multiple houses.
After entering Korea for the purpose of studying abroad, a Chinese in their 30s who was subject to the tax audit by the National Tax Service bought 8 apartments across the country as well as Seoul and received a high monthly rent, but the source of the funding was unclear.
Such speculation of real estate by Chinese people became increasingly serious from 7 years ago. According to Statista, a specialized market research firm, the proportion of Chinese among foreigners who bought a home in Seoul from 32.5% in 2015 to 61.2% in August 2019, about twice as much in the first five years. The domestic land ownership also surged 14.3 times in 8 years from 3,515 lots in 2011 to 5,559 lots in 2019.
Accordingly, Congressman Hong Seok-joon of the Power of the People proposed a bill to the National Assembly in December last year to limit speculation on foreign real estate, but it was not passed due to the violation of reciprocity.
Rep. Kim said, “Because of the gap where people’s hands and feet are tied up due to the government’s regulatory policy, the Chinese people started to’pick up (pick up and pick up)’ the K real estate,” he said. He pointed out, “I want to refuse only Chinese dreams.”