Cracking Down on Housing Price Collusion... Seoul City Intensifies Crackdown on Market Disruption Activities

Seoul City Launches Investigation in March
Price Collusion Exploits Toheoguyeok Deregulation
Brokers Urged to Advertise Above Market Value

Seoul City has launched an intensive investigation into disruptive trading activities that occurred during the period when the land transaction permission zones (Toheoguyeok) were deregulated.

The Seoul Metropolitan Government's Civil Affairs Judicial Police Bureau announced that it is conducting a focused investigation from this month into price collusion, unregistered brokerage, and false transaction reports that occurred during the deregulation period of the Toheoguyeok. This action was taken after deregulating restrictions in the so-called Jamsamdaechung (Jam·Sam·Dae·Cheong) area on the 12th of last month, as illegal transactions have been rampant amid increased transaction volumes and rising asking prices.

The main types of price collusion include △ using online communities to induce brokers not to list properties below a certain price △ using online communities to display or advertise brokerage targets at prices higher than market value △ inducing clients to request brokerage services only from specific licensed real estate agents.

The Civil Affairs Judicial Police Bureau launched an internal investigation after receiving citizen reports that many posts appeared on apartment online communities urging not to list properties below a certain price or to raise asking prices. Previously, in the second half of last year, three apartment owners were criminally charged for creating group chat rooms to monitor property advertisements and forcing real estate agents to advertise at higher sale prices. The three suspects were referred to the prosecution.

Types of false real estate transaction reports include △ reporting a contract as concluded or canceled when it was not, or △ reporting the contract amount lower or higher than the actual amount. According to current law, false transaction reports and price collusion are punishable by imprisonment of up to three years or a fine of up to 30 million KRW.

The city plans to pay rewards of up to 200 million KRW for reporting or providing tips on criminal activities with decisive evidence. Citizens who discover illegal real estate activities or suffer damages can report through smartphone applications or the Seoul City Response Center.

Choi Won-seok, head of the Seoul Civil Affairs Judicial Police Bureau, emphasized, "Artificially driving up housing prices seriously undermines a sound and transparent real estate transaction order," adding, "We will continue high-intensity investigations to ensure housing stability for citizens."