From Now On, Buying a House in Seoul Requires Submission of Supporting Documents with the Funding Plan

Minister of Land, Infrastructure and Transport Kim Hyun-mi is making an announcement regarding real estate regulation measures at the Government Seoul Office in Jongno-gu, Seoul, on June 17. Photo by Kang Jin-hyung aymsdream@

[Asia Economy Reporter Lee Chun-hee] Starting as early as the end of this month, when purchasing a house in regulated areas such as speculative overheating zones and adjustment target areas, a financial plan report must be submitted regardless of the price. In particular, in speculative overheating zones such as Seoul, not only the financial plan report but also supporting documents proving the source of the funds must be submitted.

According to the government on the 13th, the amendment to the Enforcement Decree of the "Real Estate Transaction Report Act," which includes these details, was recently classified as a "non-important" regulation during the preliminary review by the Regulatory Reform Committee. When classified as a non-important regulation, the main committee review is omitted. The government plans to implement the amendment this month after going through procedures such as the Vice Ministerial Meeting, Cabinet Meeting approval, and publication in the official gazette.

This amendment to the enforcement decree is a follow-up measure to the government's previously announced June 17 real estate measures. Through the June 17 measures, the government announced its intention to improve the current system, which only requires submission of a financial plan report for housing transactions over 300 million KRW in regulated areas such as speculative overheating zones and adjustment target areas, and submission of supporting documents only for housing transactions over 900 million KRW in speculative overheating zones.

Once the amendment is implemented, the obligation to submit a financial plan report will be expanded from housing over 300 million KRW in regulated areas to all housing transactions. The obligation to submit supporting documents, which was limited to housing transactions over 900 million KRW in speculative overheating zones, will also be extended to all housing within those areas.

Currently, speculative overheating zones include all of Seoul and 48 designated areas such as Gwacheon, Gwangmyeong, Hanam, Seongnam, Suwon, Anyang, Guri, Gunpo, Uiwang, Bundang and Sujeong districts of Seongnam, Danwon district of Ansan, Suji and Giheung districts of Yongin, Dongtan 2 in Gyeonggi Province, Yeonsu, Namdong, and Seo districts in Incheon, Dong, Jung, Seo, and Yuseong districts in Daejeon, Suseong district in Daegu, and Sejong. Adjustment target areas include 69 locations, excluding Suseong district in Daegu from the speculative overheating zones, as well as Goyang and Namyangju cities in Gyeonggi Province, Jung, Dong, and Michuhol districts in Incheon, Daedeok district in Daejeon, and Cheongju city in Chungbuk Province.

Accordingly, when trading houses within speculative overheating zones, if you intend to supplement the purchase funds with gift money from your parents, you must submit a gift tax report and tax payment certificate, and if you received company support funds, related documents must be submitted.

With the enforcement of the amendment, investigations into illegal gifts or violations of loan regulations, which were difficult to verify solely through the financial plan report, are expected to be strengthened. The government plans to select cases suspected of illegal fund procurement as subjects for focused management and initiate investigations.

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