[Anchor]
Criticism has persisted that it is difficult to buy and sell homes with tenants in land transaction permission zones due to mandatory actual residency requirements. In response, the government has decided to expand the residency grace period to up to three years and three months.
Reporter Lee Seong-hoon has the details.
[Reporter]
An apartment complex in Gangnam, Seoul.
A multi-homeowner recently gave up on trying to sell an apartment with a dedicated area of 59 square meters.
Buyers purchasing homes in land transaction permission zones are required in principle to move in within four months, but the tenant in this case was unable to move out due to personal circumstances.
The homeowner even offered tens of millions of won in moving expenses, but ultimately withdrew the property from the market.
[Real estate agent in Gangnam-gu, Seoul: If a tenant has one or two years left on their lease, it becomes impossible to meet the requirements, so many owners have simply given up on transactions altogether.]
To ease these transaction restrictions, the government, which had previously allowed actual residency to be postponed until the end of this year if the lease period remained, has extended the grace period by one year to the end of next year.
It has also decided to recognize tenant lease renewals once, for up to two years.
Based on the implementation date of October 1, combining the existing lease and the renewed lease allows actual residency to be delayed for up to three years and three months.
This follows criticism that transactions should not be blocked by mandatory residency requirements, especially since tax burdens will continue to grow next year and the year after due to the August 3 tax overhaul, which could lead to a surge in home sales.
Earlier, the ruling party also suggested that an additional grace period for actual residency is necessary to stabilize tenant housing and the jeonse and monthly rent markets.
[Kim Kyu-jung, Real Estate Expert Advisor at Korea Investment & Securities: There is a possibility that moves to sell properties due to tax pressure may increase slightly compared to now. Since gap investing for nearly three years effectively becomes possible, the original meaning of mandatory residency obligations through land transaction permission zones will likely be somewhat diluted.]
However, it is expected that transactions will not surge immediately, as it is difficult for end-users to actively purchase homes where they must wait more than a year to move in, and other restrictive factors such as loan regulations and high housing prices remain in place.
(Video editing: Nam Il, VJ: Jeong Han-wook)
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