'Ministry of Land Survey' Mocked by Real Estate Agents' Collusion... "It Has Become More Cunning"

Real Estate Market Distortion Fueled by Realtor Collusion
Penalized After Law Revision but Collusion Persists
Joint Brokerage Uses 'On Hold' Excuse Instead of Overt Refusal
Guidelines Posted and Deleted via KakaoTalk and Boards
Evidence Hard to Find... Ministry of Land, Infrastructure and Transport "Investigation Possible"

The above photo is not related to the article below. (Photo by Yonhap News)

[Asia Economy Reporter Moon Jiwon] Despite the government's strengthened penalties, there are ongoing concerns that licensed real estate agents continue to engage in collusion. In fact, some regional real estate cartels are reportedly maintaining their collusion by using more sophisticated methods, such as sharing illegal collusion-related guidelines via mobile messengers or private brokerage network bulletin boards and then promptly deleting them to evade investigations.

According to frontline licensed real estate agents on the 17th, a typical collusive act by real estate cartels is forcing non-member brokerage offices not to engage in 'joint brokerage.' Originally, such acts were not subject to penalties, but due to concerns about their negative impact on the real estate market, they were included as prohibited acts in the revised Licensed Real Estate Agent Act, which took effect on the 21st of last month.

Joint brokerage is an essential means for licensed real estate agents to sustain their livelihoods, so restricting joint brokerage makes it difficult for new brokerage offices to enter the market. Consequently, transactions concentrate among cartel-affiliated brokerages, which can lead to higher brokerage fees or 'price manipulation' by these groups, causing market distortions. From the demand side, it inevitably becomes harder to buy or sell homes.

However, even after the law revision, restrictions on joint brokerage reportedly persist. The head of A Licensed Real Estate Agency in Mokdong, Yangcheon-gu, Seoul, stated, "Real estate affiliated with cartels is responding with more meticulous methods after the law revision." Until before the law's enforcement, cartel-affiliated brokerages openly rejected joint brokerage proposals from non-member companies, but recently, they have been instructed to refuse by giving excuses such as "the property is on hold," "only advertisements were posted but there is no property," or "we will contact you later."

Industry insiders also say that the cartel's closed operations continue. The head of B Licensed Real Estate Agency explained, "After the law enforcement, the distinction between cartel members and non-members was removed from the private brokerage network's list of brokerages, but non-members still cannot access certain bulletin boards." This appears to be a superficial change made in preparation for possible on-site inspections by the Ministry of Land, Infrastructure and Transport and others.

Previously, the cartel frequently established rules such as joint brokerage restrictions and discrimination against non-members through 'bylaws,' but recently, they post guidelines on private brokerage network bulletin boards or KakaoTalk and immediately delete them.

Because of this, it is pointed out that even if illegal collusion by the cartel exists, it is difficult for non-member companies to gather evidence and report it. The cartel's key money ranges from tens of millions to hundreds of millions of won, making internal whistleblowing unlikely. It is also reported that member companies violating guidelines, such as exposing bylaws, face internal penalties including fines, business suspension, or expulsion.

The head of C Licensed Real Estate Agency in Mokdong pointed out, "Even though the law has been revised, the prohibited acts are not specific, and investigations by the Ministry of Land, Infrastructure and Transport largely rely on tips, so it will be difficult to detect collusive acts."

In response, a Ministry of Land, Infrastructure and Transport official explained, "Since it is difficult for individuals to obtain all internal information, reports can be made based on the evidence that can be secured. If the same tip accumulates, special judicial police may conduct on-site inspections or summon related persons for investigation to secure evidence."

This content was produced with the assistance of AI translation services.