Foreign homebuyers to be required to submit funding plans when reporting transactions

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Foreign homebuyers to be required to submit funding plans when reporting transactions

Published: 09 Dec. 2025, 09:17 Updated: 09 Dec. 2025, 14:26

Audio report: written by reporters, read by AI

A tourist looks at the landscape of Seoul from central Seoul's Namsan on Dec. 8. [NEWS1]

Foreigners purchasing homes in Korea’s land transaction permission zones will soon be required to submit funding plans and supporting documents when reporting the transaction.

The Ministry of Land, Infrastructure and Transport announced Monday that the revised Enforcement Decree of the Act of Report on Real Estate Transactions, which includes the new requirement, was promulgated that day and will take effect on Feb. 10. The revision is a follow-up measure to the designation of land transaction permission zones in August, aimed at curbing speculative buying of domestic real estate by foreigners.

The government previously designated all of Seoul and most of the greater capital region as land transaction permission zones after mounting criticism that foreign buyers were bypassing local lending regulations and inflating housing prices by purchasing high-end properties with overseas funds without actually residing in them.

The designated zones include all of Seoul, 23 out of 31 cities and counties in Gyeonggi — excluding Yangju, Icheon, Uijeongbu, Dongducheon, Yangpyeong, Yeoju, Gapyeong and Yeoncheon — and seven districts in Incheon, excluding Dong District, Ganghwa County and Ongjin County.

As a result, since Aug. 26 last year, foreign buyers seeking to purchase residential properties within these zones have been required to live in them for at least two years.

The key change in the revised enforcement decree is the addition of new provisions to more closely scrutinize the buyer’s purpose and funding source. The revision mandates that foreign buyers include their visa status and proof of residence in Korea for at least 183 days in the transaction report.

The ministry said it expects the change to help prevent illegal activities such as unauthorized rental operations, tax evasion and abuse of property management systems.

Apartment buildings are seen from the Seoul Sky lounge in Songpa District, southern Seoul, on Nov. 30. [NEWS1]

In particular, foreigners buying property within land transaction permission zones will now be required to submit a funding plan and supporting documentation. This must include details of overseas funds — such as loans or deposits — along with the names of the financial institutions, as well as domestic sources like assumed deposits and business-related loans.

The Land Ministry said the new rules would make it easier and faster to investigate speculative transactions and impose taxes to ensure fair taxation.

“With this enforcement decree revision, we now have a legal framework to block speculative real estate activity by foreigners,” said Park Jun-hyeong, director-general for land policy at the ministry. “We aim to stabilize housing prices by reinforcing a transaction order centered on actual demand.”

Foreign home purchases in the greater capital region dropped to 1,080 cases from September to November, a 40 percent decline compared to the same period last year. Seoul saw the largest drop at 49 percent, with Gangnam District, Seocho District, Songpa District and Yongsan District all down by 48 percent.

Chinese buyers accounted for the largest share of transactions at 72 percent, but purchases by both Chinese and U.S. nationals declined significantly — by 39 percent and 41 percent, respectively. The number of proxy manager registrations filed by foreign buyers in the region also plunged, with only one case recorded in Gyeonggi during the three-month period — a 98 percent drop from 56 cases reported during the same time last year.

This article was originally written in Korean and translated by a bilingual reporter with the help of generative AI tools. It was then edited by a native English-speaking editor. All AI-assisted translations are reviewed and refined by our newsroom.
BY HAN YOUNG-HYE [[email protected]]