00:06Before you sign anything in Korea's property market, the tax rules just changed.
00:13Starting next year, owning a home worth 2 billion won triggers a new property tax bill,
00:20even if you live there. If you own but don't live in that home, your tax bill could jump
00:26more than four times. Experts warn the mid-priced market and rental prices are headed the opposite
00:34direction, up. It's Tuesday, August 4th. Let's look at what's happening in Korea's property market.
00:45Korea's Ministry of Economy and Finance released its 2026 tax reform plan on August 3rd. The reform
00:54raises the comprehensive real estate tax threshold for owner-occupied single home owners, while
01:01tightening capital gains tax breaks on high-value properties. It also widens the gap between
01:08resident and non-resident owners across both property tax and capital gains tax. Here's
01:15what the numbers show. Homeowners occupying a 2 billion won home get their basic deduction
01:22raised to 1.4 billion won, up from 1.2 billion won. Non-resident single homeowners get only a 900
01:31million
01:32won deduction, sharply lower, pushing their taxable base up fast. On a 5 billion won home, a non-resident's
01:422028 comprehensive property tax bill would run roughly double a residence.
01:50Capital gains deductions get capped too, at 10 billion won in accumulated gains starting in 2029.
01:59On a 5.6 billion won Socho apartment sale, that cap alone raises the capital gains bill from 240 million
02:08won
02:09today to over 900 million won by 2029, nearly four times higher.
02:16The government did ease the multi-home surcharge on regulated zone sales through 2028,
02:23giving existing multi-home owners a limited window to sell.
02:28So what does this mean for buyers weighing a purchase this year?
02:33Earlier, we said non-resident owners could face tax bills four times higher than residents.
02:40Here's what that actually means for you.
02:43If you're buying to hold rather than to live in, budget for meaningfully higher annual holding costs
02:50starting next year.
02:52Meanwhile, analysts expect the mid-priced and rental markets to keep climbing,
02:58so buyers priced out of prime districts may find better value shifting toward emerging areas
03:05like Zhongnang, where transit upgrades are underway.
03:09Here's what to watch.
03:11The 2026 tax reform bills passage through the National Assembly this fall.
03:18Johnson and rental price trends through year-end, as landlords shift toward owner-occupancy.
03:25And GTXB construction progress in the Sangbong-Mangu area, targeted for a 2030 opening.
03:34That's today's AI Prism Real Estate.
03:38This episode was produced with AI assistance based on Seoul Economic Daily reporting,
03:44and reviewed by a human editor.
03:47AI Prism is a one IFRA award-winning series.
03:51We'll be back tomorrow.
03:53You've been listening to AI Prism from Seoul Economic Daily.
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