An employee at a real estate agency in Seoul watches a televised announcement of the government’s “Comprehensive Measures to Stabilize the Real Estate Market” on Aug. 13.YONHAP
Choi Min-woo
The author is the editor of political, international, foreign and security news at the JoongAng Ilbo.
President Lee Jae Myung called the “one smart home” phenomenon “a serious problem in our society” at a real estate policy debate on July 23. Isn’t that strange? Previous Democratic Party governments demonized owners of multiple homes, prompting people to sell other properties and keep one. Now that home is the problem.
When a property tax overhaul was announced, it seemed obvious that expensive single-home owners would be targeted. The government went further, dividing single-home owners into those who live in their homes and those who do not. For nonresident owners, the comprehensive real estate tax deduction will fall from 1.2 billion won to 900 million won ($846,600 to $634,500), while the holding period deduction for capital gains tax will be eliminated. The assumption is that owning a home while renting elsewhere suggests speculation and therefore deserves a tax penalty. Deputy Prime Minister and Finance Minister Koo Yun-cheol offered the familiar line: “A home is a place to live, not something to buy.”
Still, the government is not entirely unforgiving. Nonresident single-home owners may look suspiciously like speculators, but exceptions will be granted for unavoidable circumstances such as job transfers, schooling, medical treatment, caring for parents or living overseas.
Moving within the same region does not qualify. Someone who owns a home in Nowon District, northern Seoul, but moves to nearby Guri, Gyeonggi, may qualify. Moving across Seoul to distant Geumcheon or Guro districts for work does not. Education exceptions apply only to high school and university students, not elementary or middle school students. Renting in Daechi-dong in Gangnam District, southern Seoul, for better schools or private academies while owning a home in Eunpyeong District would naturally count as speculation.
An owner must first live in the home for at least one year. Renting it out immediately and moving into another rental without spending even a year there is, by the government’s logic, plainly gap investment.
Too rigid? Not at all, apparently. Since the Aug. 3 tax overhaul, petitions have poured into the government’s public legislation portal. One request is to recognize child care as an exception. In the past, children often moved in with older parents to care for them. Today, grandparents increasingly move near dual-income parents to look after their grandchildren. The government reportedly plans to accept child care as an exception. How flexible indeed.
What about other circumstances? “My child has symptoms of autism and needs to attend a special school.” Disability? There is no separate category. “I moved to Gangwon with my seventh-grade son for a rural study program run by the Seoul Metropolitan Office of Education and changed our registered address. Please make this an exception because transferring schools again would be difficult.”
Family-stay program? Rural study? It gets complicated. In any case, the government will determine whether your nonresidency is speculative. If you want an exemption, submit your transfer order, enrollment certificate, medical diagnosis, family relations certificate and other evidence. Then wait.
A question arises. Should people really have to expose such intimate details and plead their case to move homes? Of course, the government might say, “Did you expect tax savings to be easy?” If the rules are too intrusive, just live in your own home. That is the purpose of the overhaul. Otherwise, pay the higher tax.
Complaining that moving has suddenly become difficult is nonsense. Since last year’s Oct. 15 measures expanded land transaction permit zones across Seoul and the capital region, moving has already required government permission in many cases. Buyers must disclose funding sources, live in the property for two years and face tight lending restrictions.
After multiple-home owners, nonresident single-home owners have become the next target. Surely there can be no tougher regulation? Perhaps. Real estate analyst and YouTuber Lee Kwang-soo, whom President Lee reportedly watches frequently, offered a clue on MBC’s “100 Minute Debate” (1999–) on April 29: “There is no country like this. Single-home owners keep trading up to make money, pay no tax and then trade up again.”
Maybe an era of permanent residence awaits us, when once you begin living somewhere, you can never move again.
This article was originally written in Korean and translated by a bilingual reporter with the help of generative AI tools. It was then edited by a native English-speaking editor. All AI-assisted translations are reviewed and refined by our newsroom.
