Gwangju City Conducts Joint Detailed Investigation on Suspicious Real Estate Transaction Data

Request for Explanation to 2,095 People in 720 Cases from 2018 to October 2020

Gwangju City Hall

[Asia Economy Honam Reporting Headquarters Reporter Park Seon-gang] Gwangju Metropolitan City announced on the 12th that it will conduct a thorough investigation into suspicious real estate transaction data in cooperation with its five autonomous districts.

This detailed investigation is being carried out to eradicate the illegal practice of under-the-table contracts, such as those involving new apartment pre-sale rights and reconstruction move-in rights, which have frequently been reported as false real estate declarations, and to establish a sound real estate transaction order.

The investigation targets 720 transaction parties?sellers, buyers, and licensed real estate agents involved in real estate transactions contracted from 2018 to October 2020. Licensed real estate agents are also subject to investigation if they mediated the transactions.

The investigation categories include ▲390 suspicious transaction cases identified by the Ministry of Land, Infrastructure and Transport ▲318 special investigations of suspected false declarations in housing acquisition funding plans (10 cases of minors acquiring housing, 200 cases of housing acquisition exceeding 300 million KRW by persons under 30, 58 cases of housing acquisition over 600 million KRW, and 50 cases involving transactions through other borrowings without deposit succession or loans) ▲and 12 cases of direct transactions without licensed real estate agent mediation.

In December last year, Gwangju City guided all subjects of the detailed investigation to voluntarily report false real transaction declarations and received seven voluntary reports. Those who voluntarily report will be granted a full (100%) or half (50%) reduction in fines.

By the 15th, the city plans to request submission of explanatory materials from investigation subjects excluding those who voluntarily reported.

Transaction parties must submit explanatory materials such as transaction contracts, proof of payment funds (account transfer details, bankbook copies), and proof of funding sources (gifts, real estate disposals, loans, etc.) to the district office with jurisdiction over the property.

If explanatory materials are insufficient or not submitted, a second explanatory investigation will be conducted, and those who fail to submit materials until the end will be fined up to 30 million KRW.

Those found violating real transaction regulations through the detailed investigation will be subject to fines up to 30 million KRW or fines equivalent to 5% of the real estate acquisition price, and will be reported to the National Tax Service for suspected evasion of capital gains tax or gift tax. Those who violate pre-sale rights transfer restrictions will be referred for investigation.

Lee Su-won, Director of the Land Information Division of the city, stated, “We will strictly punish those who falsely report real estate transactions to realize a fair society, and we will continue to do our best to establish a sound and transparent real estate transaction order.”

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