Gyeonggi Province Designates 18 Municipalities, 3.35㎢ as Land Transaction Permitted Districts for 2 Years to Curb Speculative Real Estate Schemes

[Suwon Ilbo=Reporter Park No-hun] Gyeonggi Province newly designated 3.35㎢ of forestland and farmland in 18 municipalities including Suwon as land transaction permitted districts from June 28 to June 27, 2023, to block speculative real estate scheme investments.

Gyeonggi Province held a Gyeonggi Province Urban Planning Committee on June 18 and announced on June 23 that it had deliberated and passed the land transaction permitted district designation plan containing these details.

The designation targets this time are areas with concerns over speculative real estate investments based on actual transaction records from November last year to March this year.

The areas cover 169 parcels totaling 3.35㎢, including 9,620㎡ of forestland in Homae-sil-dong, Gwonseon-gu, Suwon City and 74,123㎡ of forestland in Gogi-dong, Suji-gu, Yongin City, which is equivalent to 1.15 times the area of Yeouido.

The province implemented the designation of land transaction permitted districts to eliminate speculative real estate practices where speculators purchase forestland and other difficult-to-develop land at low prices and then sell shares at high prices by citing development prospects.

The province previously designated speculative real estate concern areas as land transaction permitted districts on four occasions: March, July, August, and December of last year.

After the designation of land transaction permitted districts, parcels exceeding 100㎡ of forestland (50㎡ for farmland) require permission from the relevant city or county mayor to transact, and even below the permitted area, transactions involving initial co-ownership shares require such permission.

Those who enter into contracts without obtaining permission or obtain permission through fraudulent means face imprisonment of up to 2 years or a fine equivalent to 30% of the land price based on the individual public notice land value at the time of contract execution.

The province published the notice of permitted district designation in the Gyeonggi Province Gazette on June 23 and notified the Ministry of Land, Infrastructure and Transport as well as municipal and county governments.

A Gyeonggi Province official stated, "The four designations of land transaction permitted districts last year resulted in approximately a 33% decrease in forestland share transaction volume," and added, "To block planned real estate schemes at the source, we will continue real estate speculation prevention measures by expanding the designation of land transaction permitted districts for areas with speculation concerns and areas where speculation is ongoing."

Meanwhile, when Gyeonggi Province designated land transaction permitted districts for speculative real estate concern forestland in July last year and analyzed the monthly average forestland share transaction volume for 9 months before and after, the transactions decreased from 3,374 cases from November 2019 to July 2020 to 2,272 cases from August 2020 to April 2021, representing a 32.7% decrease.

The province explained that it achieved the effect of blocking speculative real estate investment through the designation of land transaction permitted districts.