3 Leading Seoul Districts to Undergo Land Deregulation

Anti-speculation regulations on three upscale Seoul districts -- Gangnam, Seocho and Songpa wards –- will be lifted around Feb. 20.

The government and the ruling Grand National Party will also pass a bill on temporarily exempting unsold apartments from transfer income tax at the extra parliamentary session this month. The bill will exclude apartments located in heavily populated metropolitan areas, however.

Choi Kyung-hwan, the head of the party’s policy coordination committee, said yesterday that high-ranking officials and party members will hold a meeting Thursday on real estate deregulation.

In a phone interview with The Dong-A Ilbo, he said, “The government and the ruling party have already agreed that anti-speculation regulations on the three (Seoul) districts should be lifted. We’ll also come up with measures to sell unsold apartments in the provinces and remove price caps on new apartments built on private land.”

The Strategy and Finance Ministry will form a committee for real estate price stabilization and remove the three districts from the list of speculative areas around Feb. 20.

If anti-speculation measures are lifted in the three districts, homeowners can resell their newly purchased apartments and the cap on the mortgage amount will be removed.

Na Seong-rin, head of the macroeconomic policy and jobs team of the ruling party’s comprehensive economic monitoring department, told Dong-A, “We decided to boost real estate transactions since the domestic market and real economy will rapidly worsen if property prices plunge amid the aggravating economic crisis.”

“If speculation reappears or property prices seem to soar in the areas, we’ll hold a committee meeting again and redesignate the three districts as speculative areas.”

Na added, “Immediately after the Strategy and Finance Ministry suggests a revised Special Tax Treatment Control Act to the National Assembly, the ruling party will hold discussions with opposition parties and pass the revised bill at the extra parliamentary session this month.”

The government and the ruling party are also pushing for a bill under which apartments in the provinces purchased within a year after the relevant law is introduced will be exempt from transfer income tax for the next five years.

The party will also handle lifting price caps on new apartments built on private land next month amid resistance from the opposition.

sunshade@donga.com