00:02You're listening to AI Prism from Seoul Economic Daily.
00:06Before you sign anything in Korea's property market.
00:11The tax base itself is changing.
00:13Korea is shifting its comprehensive real estate tax from how many homes you own to what they are worth in
00:19total.
00:21The super high value line is being drawn at 3 to 4 billion won in assessed value.
00:28Roughly 2 to 2.7 million dollars.
00:32Seoul housing completions through May fell 41.6% from a year earlier.
00:37And in Sompah, some office tell Jeunsae deposits now sit above the sale price of the same unit.
00:45It's Monday, July 27th.
00:48Let's look at what's happening in Korea's property market.
00:51Under the current system, a three-home owner paid an average of 66.66 million won in this tax last
00:59year, about $45,000,
01:01against 24.72 million won, roughly $17,000, for a single home owner holding the same value.
01:10That gap pushed demand toward one expensive apartment, the pattern Korean buyers call the one-good-home effect.
01:19The finance minister reported the revision to the president on July 24th,
01:23and a public debate is being held today before next month's tax bill.
01:28Here's what the numbers show.
01:30The revision scraps the separate rate of up to 5.0% for owners of three or more homes
01:36and applies one progressive rate to each person's combined assessed value, in the bill due early next month.
01:43Three to four billion won in assessed value, roughly $2 to $2.7 million,
01:49is the line under discussion for the top bracket, which, at the 69% assessment ratio,
01:56maps to about $2.7 to $3.4 million in market price.
02:02The basic deduction for single home owners, now $1.2 billion won, or about $818,000,
02:09is under review for a modest increase.
02:13Long-term holding and senior deductions worth up to 80% shift toward actual residence,
02:19with exceptions for job transfers and overseas postings.
02:23Seoul housing completions through May came to 13,111 units,
02:29down 41.6% from 22,440 a year earlier.
02:35In Songpa, a 23.6-square-meter office tell leases from 195 million won
02:42and sells from 193 million won, roughly $133,000 and $132,000.
02:50So what does this mean for buyers weighing a purchase this year?
02:53Earlier, we said the tax base itself is changing.
02:57Here's what that actually means for you.
02:59Holding one expensive home stops being the tax-efficient structure it was,
03:03because a new bracket opens above roughly $2.7 million in market price,
03:09while the penalty for owning several homes falls away.
03:12For owners living abroad, the sharper change is the deduction test moving from years held
03:17to whether you actually live in the property, with narrow exceptions written into the plan.
03:23Watch today's public debate on property policy, chaired by the Prime Minister.
03:28Watch the tax revision bill due in early August,
03:32which carries the final bracket lines and the new deduction level.
03:35Watch sole completion and start data through the second half,
03:39after the 41.6% drop through May.
03:43That's today's AI Prism, real estate.
03:46This episode was produced with AI assistance based on Seoul Economic Daily reporting
03:51and reviewed by a human editor.
03:54AI Prism is a Juan Ifra Award-winning series.
03:57We'll be back tomorrow.
03:59You've been listening to AI Prism from Seoul Economic Daily.
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