[Apartment Official Price Announcement] 'Property Tax Bomb' Realized... Gangnam Area Two-Home Owners Pay Double

Ministry of Land Announces This Year's Nationwide Official Apartment Price Estimates
High-Value Housing Shows Significant Fluctuations... Holding Tax Burden Also Rises
Gangnam 85㎡ Holding Tax 6.95 Million KRW → 10.17 Million KRW

[Asia Economy Reporter Moon Jiwon] This year, the announced official prices for apartment complexes are expected to rise sharply, significantly increasing the property tax burden on high-priced homes.

The Ministry of Land, Infrastructure and Transport announced on the 18th the scheduled official prices for 13.83 million apartment units nationwide as of January 1 this year, and stated that owners can review and provide feedback until the 8th of next month.

According to the announced official prices, the average official price of apartment complexes nationwide increased by 5.99% compared to last year. By city and province, Seoul saw the highest increase at 14.75%, followed by Daejeon with a 14.06% rise, both recording double-digit growth rates. Next were Sejong (5.78%) and Gyeonggi (2.72%).

By price range, homes priced under 300 million KRW saw a 1.90% decrease in official prices this year, continuing the decline from last year (-2.48%). On the other hand, official prices for homes priced over 900 million KRW rose by an average of 21.15%, showing that the higher the market price, the greater the increase in official price.

(Data from the Ministry of Land, Infrastructure and Transport)

Accordingly, owners of high-priced homes are expected to face a significantly increased burden of property taxes such as property tax and comprehensive real estate tax this year.

According to the property tax and health insurance premium simulation data analyzed and released by the Ministry of Land on the same day, property tax burdens for homes priced under 300 million KRW in provincial areas and homes priced between 300 million and 600 million KRW in metropolitan cities will slightly decrease this year.

For example, in the case of Apartment A in a provincial area, where the official price dropped by 10 million KRW from 150 million KRW last year to 140 million KRW this year, the property tax also decreased from 250,000 KRW to 230,000 KRW. Similarly, an apartment in a provincial metropolitan city with an official price decrease from 280 million KRW to 270 million KRW saw its property tax reduced from 520,000 KRW to 500,000 KRW.

Apartment complex in downtown Suwon, Gyeonggi-do (Photo by Yonhap News)

Homes priced between 300 million and 600 million KRW are also expected to see a slight increase in property tax, but the burden is analyzed to be not significant. For example, Apartment A in the metropolitan area, with an official price increase from 390 million KRW last year to 450 million KRW this year, will see property tax rise from 810,000 KRW to 900,000 KRW, and health insurance premiums increase from 151,000 KRW to 155,000 KRW.

Conversely, for single-homeowners subject to comprehensive real estate tax, homes priced over 900 million KRW will experience a larger increase in property tax.

For Apartment C in the metropolitan area, where the official price rose by 5.3% from 940 million KRW last year to 990 million KRW this year, the property tax burden increases by 10.3%, from 2.9 million KRW to 3.2 million KRW.

Apartment D in the metropolitan area, with an official price increase of 20.4% from 980 million KRW to 1.18 billion KRW, will see an even larger property tax increase. The property tax jumps 41.9%, from 3.1 million KRW last year to 4.4 million KRW this year. The health insurance premium for this apartment owner rises from 191,000 KRW to 207,000 KRW.

Seoul Autonomous Districts' Officially Announced Price Change Rates (Data from Ministry of Land, Infrastructure and Transport)

Especially for high-priced homes over 1 billion KRW, the sharp rise in official prices pushes property taxes close to the upper limit of tax burden.

In the case of Apartment E in the metropolitan area, the official price increased by 34.8% from 1.15 billion KRW to 1.55 billion KRW, causing property tax to surge from 4.2 million KRW to 6.1 million KRW (a 45.2% increase). For Apartment F, where the official price jumped from 2.08 billion KRW to 2.74 billion KRW, the owner is expected to pay an additional 6.4 million KRW (from 13.3 million KRW to 19.7 million KRW) in property tax this year.

The property tax burden is expected to be concentrated in the Gangnam area, where high-priced apartments are densely located.

For Apartment G in Gangnam-gu, Seoul, with a floor area of 84.43㎡ (exclusive area), the official price rises from 1.152 billion KRW to 1.59 billion KRW this year. The property tax burden increases from 4.198 million KRW to 6.103 million KRW. Even applying the comprehensive real estate tax credit limit of 70%, the property tax this year reaches 5.4 million KRW.

Apartment H in Seocho-gu, with a floor area of 84.95㎡, also sees its official price rise by 35.5% from 1.9 billion KRW to 2.574 billion KRW, and property tax increases by 47%, from 11.23 million KRW to 16.525 million KRW.

Multi-homeowners are expected to receive property tax bills at a 'bombshell' level.

For example, a person owning two apartments?one in Gangnam-gu measuring 50.64㎡ (priced at 1.596 billion KRW) and another in Seocho-gu measuring 84.95㎡ (priced at 2.574 billion KRW)?is expected to face a property tax burden of 53.66 million KRW this year, nearly double last year's 23 million KRW.

Meanwhile, the government has set limits to prevent a sudden increase in tax burden by capping the increase in property tax compared to the previous year. The limit rates are 200% for owners of two homes in regulated areas, 300% for owners of three or more homes, and 150% for others.

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