Uninhabited Island Auction Sparks Interest ... Appraised at 7 Million Won, Sold for 230 Million Won

Jindo-gun Uisin-myeon 'Sangdureukdo' in Jeonnam ... Usable and Accessible for Leisure Purposes
More than 5 Uninhabited Island Auctions Annually Since 2011 ... Attention on Uninhabited Island Investment

[Asia Economy Reporter Intern Lee Gyehwa] According to the court and the auction industry on the 2nd, Sangdureukdo, an uninhabited island located in Uisin-myeon, Jindo-gun, Jeollanam-do, was sold at auction on the 31st of last month for 234,594,100 KRW, more than 30 times its appraised value. The appraised value of this island, which attracted over 50 bidders, was 7,799,300 KRW.

The land area of Sangdureukdo is 3,391 ㎥. It is designated as a conservation management area, livestock breeding restricted zone, quasi-conservation uninhabited island, quasi-conservation mountain area, and a zone subject to permission for changes in the current state. Quasi-conservation means that new construction or expansion of buildings is not allowed, but some leisure uses such as snorkeling, scuba diving, and trekking, as well as access, are permitted. However, the Minister of Oceans and Fisheries may impose temporary access restrictions if necessary.

Fifty-one people participated in the auction held at the Haenam branch of the Gwangju District Court. Due to fierce competition, the island was sold for more than 30 times its appraised value. The auction industry commented, "Since uninhabited islands rarely come up for auction, many bidders gathered."

In the past, uninhabited islands that went up for auction were also sold at high prices. In 2020, 'Kkachiseom,' an uninhabited island in Jeungdo-myeon, Sinan-gun, was auctioned to 19 bidders for 10 times its appraised value of 9.59 million KRW, selling for 105 million KRW. In 2015, 'Galdo' in Jodo-myeon, Jindo-gun, Jeollanam-do, where half of the total 35,108㎡ area was owned by an investor, was auctioned for 10.8 million KRW, which was 228% of its appraised value.

As perceptions of islands have changed, uninhabited island real estate investment is gaining attention. From 2011 to 2017, except for 2012 (4 cases) and 2014 (1 case), more than five uninhabited islands have come onto the auction market each year. The auction industry analyzes that increased exposure through filming of movies, dramas, variety shows, and YouTube programs on islands, along with the development of the marine leisure sports industry, has increased interest in island investment.

However, there are points to be cautious about when investing. First, you need to check what type the island is designated as, because development cannot be done at the owner's discretion. According to the Uninhabited Islands Act, uninhabited islands are classified into four types: △absolute conservation △quasi-conservation △usable △developable. You should first consider this management type and then examine the regulations for each land use in detail.