Land prices soar 19.4% in Jeju Island over the past year

In the wake of the government’s announcement to build a second international airport in Jeju Island and amid an investment boom by Chinese nationals and Korean mainlanders, land prices in the resort island of Jeju soared nearly 20 percent for the past year.

The Land, Infrastructure and Transport Ministry said on Monday that its survey on January 1 of official land prices for 500,000 standard land lots across the nation revealed land prices increased by 4.47 percent on average year-one-year. The prices have shown the highest yearly gain since 2008 (9.63 percent), which continued to advance for seven consecutive years. The official prices of standard land lots are used as the benchmark for calculating official prices for 31.98 million land lots nationwide, and as the standard for levying various taxes including property tax and transfer tax.

By metropolitan city and province, the official land prices of Jeju Island have gained 19.35 percent, which translated into more than four times the national average. By city, ward and county, Seogwipo City (19.63 percent) and Jeju City (19.15 percent) ranked first and second in land price growth, respectively. Analysis showed that Seogwipo saw land price soar thanks to the announcement of a plan to construct a second international airport, and a hike in Chinese investment, while Jeju saw the price spike to urban development projects and a growing population. Sejong special administrative city (12.90 percent) and Ulsan metropolitan city (10.74 percent) also posted double-digit growth in land prices due to the projects of innovation city and housing land development.

With a hike in official land prices, the tax burden on land owners in Jeju Island will also likely increase, with property tax and general real estate tax poised to soar more than 10 percent on average. The official land prices for standard land lots can be checked at the ministry’s website (www.molit.go.kr), or administrative service centers at city, ward and county offices through March 24.

김재영기자 redfoot@donga.com