The South Korean Ministry of Land, Infrastructure and Transport launched a targeted investigation into 840 suspicious real estate transactions involving foreign nationals, examining capital sources and potential illegal offshore fund transfers. According to the Ministry, the probe runs from August through December, with final results scheduled for publication at the end of the year.
Targeting Illegal Foreign Real Estate Transactions
The government’s crackdown focuses on real estate deals reported between June of last year and July of this year. According to the Ministry of Land, Infrastructure and Transport, officials selected 840 suspicious transactions across residential, non-residential, and land sectors for special inspection. This figure marks an increase from the 605 cases investigated during the previous year’s sweep, driven by newly acquired datasets under enforcement decree revisions to the Real Estate Transaction Reporting Act implemented in February.
Investigators are scrutinizing declarations involving stock, bond, and cryptocurrency liquidation proceeds, alongside overseas financial institution loans and residency qualifications used to purchase domestic property. According to the Ministry, the expanded dataset allows officials to tighten screening criteria and verify the actual origins of purchase funds. Authorities are paying particular attention to illegal foreign capital introductions and unauthorized visa-free leasing operations.
Enforcing Residency Compliance in Restricted Zones
Alongside capital verification, the Ministry is partnering with local governments, including the Seoul Metropolitan Government, to inspect whether foreign buyers comply with mandatory residency requirements within land transaction permission zones. According to government guidelines, municipal district offices hold the authority to issue compliance orders if buyers violate actual residency mandates.
Failure to follow these compliance orders results in the imposition of financial penalties known as compliance levies. If violations persist or non-compliance continues, local authorities retain the power to cancel the original land transaction permits entirely. Special planning investigations into foreign property buying began in 2022 following a surge in suspicious transactions, such as ultra-high-end home purchases and bulk acquisitions fueled by overseas capital.
Historical Enforcement Data
Government oversight of foreign property acquisitions has expanded steadily over the past several years. According to Ministry data covering 2022 through the end of last year, authorities investigated 2,299 foreign transactions across the capital region, including 783 cases in Seoul, 408 cases in Incheon, and 1,108 cases in Gyeonggi Province. Out of those regional inspections, officials referred 1,553 total cases—579 in Seoul, 246 in Incheon, and 728 in Gyeonggi—to relevant law enforcement and tax authorities for further legal action.
“We will thoroughly investigate and respond to illegal transactions so that foreign housing speculation does not undermine the stability of our real estate market order,” said Shin Yun-geun, the Ministry’s Land Policy Officer.
Worth a look