Did the Permit System Work?... Foreign Real Estate Purchases Drop by 2,000, 73% by Chinese Buyers [Real Estate AtoZ]

“Real Estate Shopping” Until the Day Before Implementation
Designation Period Ends on the 25th
Fewer Loan Restrictions for Overseas Borrowing
Continued Debate Over Reverse Discrimination Against Koreans

During the one year since the implementation of the Foreigners’ Land Transaction Permit Zone, the number of foreigners purchasing apartments or commercial properties in the Seoul metropolitan area decreased by over 2,000. Seven out of every ten of those who disappeared from the statistics were Chinese nationals. As the initial designation period ends on the 25th, the government is leaning toward extending the measure.

According to court registration data on the 6th, 9,184 foreigners purchased collective buildings (such as apartments, officetels, and commercial properties) in Seoul, Gyeonggi Province, and Incheon from September last year—the month immediately after the permit zone designation—through last month. Compared to the same period prior to the regulations (October 2024 through August 2025), which saw 11,209 buyers, this represents a drop of 18.1% (2,025 fewer buyers). Since the statistics are calculated monthly, August of last year—which includes the August 26, 2025 implementation date—was included in the pre-regulation period.

View of apartments and other buildings from Namsan, Seoul. Photo by Yonhap News Agency

Last August, in a bid to curb real estate speculation by foreigners, the government designated all of Seoul, 23 cities or counties in Gyeonggi Province, and 7 autonomous districts in Incheon as permit-required zones. Foreigners purchasing homes in these zones must obtain approval from the local government and actually reside there for two years.

Of the 2,025-person overall decrease, 1,470 buyers—or 72.6%—were Chinese nationals. The number of Chinese buyers in the Seoul metropolitan area fell by 19.6%, from 7,489 to 6,019 during the same period. In Seoul, the number of Chinese buyers dropped by 9.2%, from 844 to 766, while the number of American buyers also decreased, from 632 to 612, down 3.1%.

In regions outside the Seoul metropolitan area, the number of foreign buyers fell slightly from 4,901 to 4,841, a decrease of 1.2%—a virtual standstill. This is interpreted as the result of the permit zone designation applying only to the Seoul metropolitan area.

By region, Gyeonggi Province saw the largest drop. Foreign buyers in Gyeonggi declined by 21.6%, from 6,812 to 5,339. Incheon experienced a 17.4% decrease, from 2,344 to 1,936, while Seoul saw a 7% dip, from 2,053 to 1,909.

Just prior to the introduction of the permit system last year, foreign registration applications flooded in. In August last year, the number of foreigners buying property in the metropolitan area was 1,211, a 6.5% increase from 1,137 the previous month—the highest number since October 2021 (1,128). In Incheon, the foreign buyer count rose by 56.4% from 243 the month before to 380, more than double the level from the same month the previous year (183).

Immediately after the implementation, in September, the metropolitan area saw 1,154 buyers. In October, the figure fell by 32% in just a month, down to 785. As there is a time lag between the real estate contract and the registration of ownership transfer, it appears that some transactions made before the regulation went into effect were reflected in the September data.

With the designation deadline of the 25th approaching, the Ministry of Land, Infrastructure, and Transport is reviewing whether to extend the policy. Since a number of suspected illegal acts—such as expedient gifting and illicit overseas capital inflows—have been detected in the metropolitan area, the likelihood of an extension is growing.

The Ministry plans to decide whether to extend the designation after deliberation by the Central Urban Planning Committee. A Ministry official stated, "A final conclusion will be reached after going through the necessary procedures and review."

This content was produced with the assistance of AI translation services.