Gwangju City Implements Partial Amendment to the Act on Reporting Real Estate Transactions

From the 27th, Submission of Funding Plans Mandatory for Corporate Housing Transactions Regardless of Region or Amount

Gwangju City Hall

[Asia Economy Honam Reporting Headquarters Reporter Park Seon-gang] The Gwangju Metropolitan City announced on the 26th that from the 27th, when a corporation purchases a house and reports the transaction, it must submit a fund sourcing plan to the district office regardless of the amount, and additionally report whether there is a special relationship.

As part of follow-up measures to the "Management Plan for Stabilizing the Housing Market" jointly announced by related ministries on June 17, a partial amendment to the "Enforcement Decree and Enforcement Rules of the Real Estate Transaction Reporting Act," which includes expanding the scope of fund sourcing plan submissions, will take effect from this day.

The main points of the amendment are ▲ submission of fund sourcing plans for corporate housing transactions ▲ expansion of reporting items for corporate transactions.

Before the amendment, individuals and corporations alike were required to submit a fund sourcing plan only when purchasing a house worth 600 million KRW or more. However, in the case of corporate housing purchases, transactions under 600 million KRW, which were excluded from the fund sourcing plan submission requirement, had the potential to be exploited as means of real estate speculation through transactions with special related parties.

Therefore, to strengthen the actual transaction investigation system for corporations, all transaction reports where the corporation is the buyer must mandatorily submit a fund sourcing plan.

When reporting corporate housing transactions, in addition to the existing general reporting items, corporations must additionally report the corporate registration status, whether there is a special relationship between transaction parties, and the purpose of acquiring the house.

To enhance transparency in corporate real estate transactions and enable effective actual transaction investigations, the "Corporate Housing Transaction Contract Report" has been newly revised to require additional reporting of ▲ corporate registration status ▲ special relationship between transaction parties ▲ purpose of housing acquisition.

Over the past three years, the volume of corporate housing transactions in Gwangju has been increasing annually, with 1,777 cases in 2018, 2,361 cases in 2019, and 2,076 cases as of September 2020.

Lee Su-won, Director of the Land Information Division of the city, said, "Corporate housing purchases were difficult to understand the relationship between transaction parties and could be exploited as a means of illegal transactions and real estate speculation, but with the amendment of related laws, effective inspections of illegal activities have become possible."