Real estate in South Korea

South Korea stands out among Asian countries in that it allows foreigners to purchase residential and commercial real estate without restrictions. Here, foreigners are treated the same as locals, which is a rarity in this region. Attractive real estate markets make the country interesting for investors. The diverse range of housing on offer, from luxurious houses on the coast to cozy cottages in historic districts, offers options for every taste. A well-developed infrastructure and a favorable economic environment contribute to the country's attractiveness as a place to live and do business.

Seoul is the capital and largest city in South Korea. Seoul offers a wide range of real estate, from luxury apartments in the center to affordable apartments in the suburbs. Despite strong competition, Seoul remains an attractive investment opportunity due to stable demand. Property prices in Seoul are very high, ranging from $5,000 to $10,000 per square meter in the central areas.
Busan - the second largest city in South Korea and the country's largest seaport. Real estate prices here are lower than in Seoul, while the city is developing dynamically. Busan attracts both local and foreign buyers. The average cost of real estate in Busan is $3000-4000 per 1 m².
Incheon is a port city close to Seoul, known for its international airport and free trade zones. Real estate in Incheon can be a good option for those who work in Seoul but are looking for a more affordable place to live. Housing prices in Incheon are lower than in the capital, ranging from $2000 to $3500 per square meter.
Jeju is an island in the south of South Korea and a popular tourist destination. Demand for accommodation and hotels is growing here, especially on the waterfront. Jeju attracts both local and foreign investors. Real estate prices on Jeju start at $1000 per 1 m².
Gwangju is a city in the southwest of the country known for its universities and high-tech industry. Due to the influx of students and IT professionals, demand for rental properties remains high. Property prices are around $1500-2000 per 1 square meter.
In general, the best prospects are in major cities with dynamically developing economies. When selecting a particular property, the location, transport links and development prospects of the neighborhood must be taken into account.

In South Korea, there are certain legal restrictions and regulations on the ownership and sale of real estate by foreign nationals. These restrictions include the following aspects:
Restrictions on certain types of real estate: foreign nationals are allowed to own various types of real estate, but there are restrictions on certain types, such as agricultural land or land in border areas. Prior government approval is required to purchase such land.
Reciprocity: South Korea applies the principle of reciprocity, which means that the rules for foreign nationals may depend on whether their countries allow South Korean nationals to own real estate in their territory.
Registration and reporting: Foreign nationals who acquire real estate must register their property with the local district office. They must also submit transaction reports to the relevant authorities in order to comply with South Korean laws and regulations.
Although foreign nationals are allowed to own real estate in South Korea, it is important to comply with these conditions in order to carry out the acquisition in accordance with local laws and regulations.

Foreigners generally do not need to apply for a special visa to purchase a property in South Korea.

However, there are a few special features:

• Citizens of most countries can enter South Korea visa-free for up to 90 days. Simply apply for a K-ETA online. This is usually enough time to check the options and complete the transaction.
• If you need a longer stay for any reason, you can apply for a tourist visa, which is issued for up to 30 days.
• For a long-term stay to live in the purchased property, an F-2 visa is required. This is issued if you can provide proof of purchase of the property.
• A D-8 business visa may be required for the purchase of commercial property.

Presence in the country at the time of purchase is not necessarily required. The documents can be executed by a representative. It is therefore not necessary to apply for a visa in advance for the purchase of real estate in Korea itself. In some cases, however, a visa is required for a longer stay in the country.

When buying a property in South Korea, foreigners have to pay several types of taxes and fees.
The land transfer tax is 2.3% of the value of the property. This tax is paid to the seller.
A registration tax of 3% of the value is also payable when the transaction is registered.
VAT of 10% is levied on the total purchase price including the transfer tax.
A levy of 5% is charged on housing bonds, which is paid into a housing development fund.
Stamp duty is also levied when the purchase contract is registered. It amounts to around 0.2-0.4% of the property value.
In addition, there are smaller local taxes and levies that can amount to up to 1% of the value.
This means that the total tax burden when buying a property in Korea for foreigners is around 20-22% of the property value. These costs should be taken into account when planning the transaction.

Following an offer to sell a property, a lawyer must draw up and sign a purchase agreement between the buyer and seller in South Korea. Although not mandatory, the seller often requires a down payment at this stage, usually 10% of the transaction value. The payment terms are specified in the contract and are usually split into 2 or 3 transactions. If 3 or more payments are agreed, it is not possible to cancel the transaction after the second payment. The real estate registration process in South Korea involves two stages: land acquisition registration and title transfer registration.
1. land acquisition by a foreigner: Foreigners are subject to the Foreigner Land Acquisition Act and are required to obtain a land acquisition report when acquiring real estate. For this purpose, the transaction must be reported to the local authority (Si, Gun or Gu) within 60 days of signing the contract. The required documents include the signed contract, the foreigner registration card and a copy of the cadastral plan in which the seller is registered.
If a property is purchased in a "protected area", a permit must be obtained from the Si, Gun or Gu offices before the contract is signed. Protected areas include military zones, ecosystem conservation areas and areas with cultural values. Failure to obtain a permit may result in a fine or imprisonment.
2. transfer of ownership: Within 60 days of paying the full purchase price, property registration must be completed with the local authority. This requires the submission of a foreigner registration card, a completed application form, documents to prove the reasons for registration, a land acquisition report and a registration certificate.
The registration process is similar for non-resident land purchases, including obtaining a land acquisition report and registering the transfer of ownership. A registration number must also be obtained from the Immigration Department, with copies of the land acquisition report and passport.
Foreign exchange transactions: As a non-resident, you are subject to the Foreign Exchange Transactions Act and must inform the bank of the transaction (property purchase). For this purpose, copies of the contract, the valuation report and the land register entry must be submitted.
Real estate agents and lawyers: It is recommended to use a local real estate agent who is insured against fraud and property issues. A lawyer is also important to prepare the purchase contract and ensure that all South Korean regulations and laws are complied with, which is especially important with the complicated property registration process.

• Language barrier. Contracts and documents are written in Korean and are therefore difficult to understand. It is recommended to hire an English-speaking translator or real estate agent.
• Differences in the legal system. South Korean real estate law differs from that of other countries, so you should consult a local lawyer.
• Complicated property registration procedures. The process of re-registering documents for foreigners can take a long time.
• Strong competition in the housing market in major cities. Local buyers can offer a higher price.
• Restrictions on the purchase of land by foreigners. Approval from the South Korean government is required.
• Risk of fraud. Sellers, real estate agents and documents should be carefully checked.

To minimize the risks, it is advisable to check the details of the transaction thoroughly and consult a reliable local real estate agent and lawyer.