[6·21 Real Estate Measures] Acquisition Tax Reduction for First-Time Home Buyers... Available to Everyone Regardless of Income or Housing Price

On the 17th, a view of apartments from Lotte World Tower Seoul Sky in Songpa-gu, Seoul. The Korea Real Estate Board announced that the actual transaction price index for apartment sales in Seoul in March was 175.1, up 1.4 points from the previous month (173.7). This marks the first time in five months that the Seoul apartment sales actual transaction price index has turned upward again since recording 180.0 in October last year. Photo by Jinhyung Kang aymsdream@

[Asia Economy Reporter Hwang Seoyul] The government announced that it will exempt acquisition tax for first-time homebuyers regardless of income and housing price.

On the 21st, at the '1st Real Estate Related Ministers' Meeting,' the government announced a policy to exempt acquisition tax for anyone who is a first-time homebuyer without restrictions on annual income or housing price. However, to alleviate the local financial burden caused by the decrease in acquisition tax revenue, which is a local tax, and to prevent excessive benefits for high-priced homes, the exemption limit is capped at 2 million won.

Currently, even if purchasing a home for the first time in one's life, acquisition tax is exempted only if the conditions of annual income below 70 million won and purchasing a home priced below 400 million won in the metropolitan area or 300 million won in non-metropolitan areas are met. If the housing price is below 150 million won, 100% acquisition tax exemption applies; if exceeded, a 50% exemption is granted.

When the system was implemented in July 2020, the current requirements were established reflecting the median housing price, but since then, housing prices, especially in metropolitan area apartments, have risen, reducing the policy's effectiveness.

Also, for first-time homebuyers near the income and housing price thresholds that determine exemption eligibility, there have been cases where they were excluded from policy benefits due to slight differences.

With this government measure, the number of households benefiting from acquisition tax exemption is expected to expand from the current 123,000 households to 256,000 households.