Gyeonggi-do Achieves 'Major Success' with Five Land Transaction Permission Zone Designations... Transactions Plummet by 31%

[Asia Economy (Suwon) = Reporter Lee Young-gyu] As a result of Gyeonggi Province designating land transaction permission zones five times in total to block speculative demand from planned real estate, the volume of forest land share transactions in the province decreased by 31% compared to before the designation, showing an effect of market stabilization.

Gyeonggi Province has designated a total of 244.77㎢ as land transaction permission zones in five rounds: ▲ 5.58㎢ of forest land in Sangjeok-dong, Seongnam City (March 2020) ▲ 211.98㎢ redevelopment and reconstruction project area in Deogyang-gu, Goyang City (July 29, 2020) ▲ 2.32㎢ in Hyeondeok District, Pyeongtaek City (August 2020) ▲ 24.54㎢ of forest land and farmland in cities and counties (December 2020) ▲ 3.35㎢ of forest land and farmland in 18 cities and counties (June 2021).

The province analyzed the volume of forest land share transactions in the 11 months before and after the second designation, which accounted for 86.6% of the total designated area and was the largest land transaction permission zone designation.

According to the analysis, from August 2020 to June 2021 after the designation, the volume of forest land share transactions was 25,483 cases, a decrease of 11,673 cases (31.4%) compared to 37,156 cases from September 2019 to July 2020, 11 months before the designation.

An official from the province explained, "The designation of land transaction permission zones is a system that requires approval from the mayor or county governor of the jurisdiction when buying land, so that actual demanders, not speculative forces, purchase the land," adding, "The designation of land transaction permission zones has had a significant effect in blocking illegal activities by planned real estate."

Illegal activities by planned real estate refer to corporations using trade names such as 'OO Auction, OO Development' that buy land or forest land, which are practically difficult to develop, at low prices, then advertise as if large profits can be made, recruiting many investors and selling land shares at high prices.

Additionally, in December last year, the province signed a 'Business Agreement to Eradicate Illegal Activities by Planned Real Estate' with the Gyeonggi Southern and Northern Police Agencies and operates a 'Planned Real Estate Illegal Activities (Damage) Reporting Center.'

The province has provided a list of corporations suspected of share transactions and planned real estate offenses.

Through this, 15 people were arrested on fraud charges, 4 were detained, and illegal profits amounting to 24.2 billion KRW were subject to seizure and confiscation requests before prosecution. Also, among 125 damage reports received by the Planned Real Estate Illegal Activities Reporting Center judged to have illegal suspicions, investigations have been requested to the Gyeonggi Southern and Northern Police Agencies.

The province recently urged caution regarding illegal activities using the designation of land transaction permission zones in speculative areas by planned real estate.

According to the province, some planned real estate entities are forcing purchases by saying, "Since it has been designated as a land transaction permission zone, if you buy and wait, you will see several times the profit later," collecting down payments and balances.