Rather Than Selling, They Gift... Record High 'Non-Apartment' Donations Until August This Year

Nationwide Non-Apartment Gifts Total 41,041 Cases, Seoul Non-Apartment Gifts Also Up 10% Year-on-Year

The view of a villa neighborhood from a building in Yangcheon-gu, Seoul, where villa transaction volumes are increasing on the 11th. Photo by Moon Honam munonam@

[Asia Economy Reporter Kim Min-young] Not only apartments but also villas and detached houses have seen record-high gift transfers. This appears to be the result of overlapping factors such as homeowners' capital gains tax and comprehensive real estate tax burdens, along with expectations of rising house prices.

Station3, which operates the real estate platform Dabang, analyzed gift transfers of multi-family/row houses (villas) and detached/multi-household houses through the Korea Real Estate Board on the 6th. It found that the number of non-apartment gift transfers nationwide reached 41,041 cases by the end of August this year. This is the highest since 2013 for the same period. This figure accounts for 13.1% of total transactions (312,392 cases), including sales, judgments, exchanges, gifts, and pre-sale rights transfers. Compared to 37,715 cases during the same period last year, this represents an 8.8% increase.

The proportion of gift transfers has also increased. When the Korea Real Estate Board began compiling sales statistics for villas and detached/multi-household houses in 2013, the share of gift transfers in total housing transactions was only 9.4%. However, this proportion rose to 11.7% in 2018, then continued to grow to 13.2% in 2019 and 13.6% in 2020.

Gift transfers of non-apartments in Seoul are also active. The number of non-apartment gift transfers in Seoul reached 8,041 cases, marking the highest for the same month since 2013. Compared to 7,329 cases during the same period last year, this is a 9.7% increase. This contrasts with apartment gift transfers in Seoul, which decreased by 28.7% to 10,355 cases by August this year from 14,521 cases last year.

The share of non-apartment gift transfers in total transactions in Seoul was recorded at 11.2%. After dropping to 4.7% in 2015, the proportion steadily increased, reaching double digits at 10.0% in 2019 and rising further to 10.9% in 2020.

The ongoing boom in non-apartment gift transfers appears largely influenced by the government's strengthened tax burden policies. As the government imposed heavier capital gains and comprehensive real estate taxes on multi-homeowners and reduced or abolished benefits for rental business operators, homeowners turned to gift transfers rather than holding or selling to reduce tax burdens. Expectations of further price increases due to revitalized redevelopment projects also contributed to the rise in gift transfers.

A Dabang official said, "The combination of high-intensity tax hikes targeting multi-homeowners and expectations of future house price increases is increasing the proportion of gift transfers not only for apartments but also for multi-family row houses and detached multi-household houses."

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