Strengthened Local Government Review of Apartment Official Prices... Accelerated Steps to Abolish Realization Plan

The ruling party and the government are accelerating the abolition of the 'Officially Announced Price Realization Plan,' a remnant of the Moon Jae-in administration. Recently, following the National Assembly's proposal of a bill to amend the 'Real Estate Price Disclosure Act' (hereinafter referred to as the Real Estate Disclosure Act), which centers on abolishing the realization plan, the government revised the enforcement decree of the same law to strengthen the review function of local governments in calculating official prices.

View of the city from Seoul Sky in Songpa-gu, Seoul / Photo by Yonhap News

On the 13th, the Ministry of Land, Infrastructure and Transport announced that it had approved the amendment to the enforcement decree of the Real Estate Disclosure Act at the Cabinet meeting to enhance the objectivity and reliability of official prices. The amendment includes expanding the review function of local governments (cities, counties, districts) in the process of calculating the official prices of multi-family housing. Similar to the calculation of official prices for standard land and standard houses, the local real estate price disclosure committee of cities, counties, and districts is now required to review and provide opinions on the official price proposals.

The government's efforts to secure the objectivity of official prices stem from the push to abolish the realization plan. Earlier, President Yoon Suk-yeol announced at the 21st Livelihood Discussion held at Mullae Arts Center in Yeongdeungpo-gu, Seoul, in March that the official price realization plan would be completely abolished to ease tax burdens.

This plan was implemented during the Moon Jae-in administration, aiming to increase the realization rate annually until 2030 for multi-family housing. However, as housing prices soared, the official prices, which serve as the tax base, also rose, leading to increased tax burdens. Consequently, the Yoon Suk-yeol administration considered revising the realization rate targets but ultimately decided to abolish the plan.

The issue is that amending the law requires the consent of the National Assembly. On the 7th, Kim Eun-hye, a member of the People Power Party, took the lead in proposing a bill to abolish the official price realization plan and to have the Central Real Estate Price Disclosure Committee comprehensively review and deliberate on fairness regarding taxes and charges under the Real Estate Disclosure Act. However, following the April general election results, the political landscape shifted to a situation where the ruling party holds fewer seats than the opposition, making predictions difficult.

Kim's office stated, "Major advanced countries such as the UK and Germany have not adjusted official prices for over 30 years due to concerns about taxes and real estate price increases," adding, "We will do our best to normalize the abnormal official price policy so that citizens' property rights and the right to pursue happiness are firmly protected."

On the same day, the government also approved an amendment to the enforcement decree of the 'Act on Appraisal and Appraisers,' extending the validity period of scores from certified language tests (such as TOEIC and TOEFL), which replace the English subject in the first appraisal exam, from the existing two years to five years.

This is a follow-up measure to the government's national agenda and the economic policy direction announced in January this year. The amendment will apply to English scores expiring after the enforcement decree is promulgated on the 20th of this month. Specific details regarding the scope of accepted English scores and submission methods will be separately announced by the Korea Industrial Human Resources Corporation, the entrusted examination agency. The Ministry of Land, Infrastructure and Transport expects that the economic and time burdens on examinees will be significantly reduced.

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