Only 76 Cases of Permit Denial
Approval Rate Reaches 99.4%
Permits Concentrated in Gangnam and Songpa
Since the designation of land transaction permission zones in Seoul in 2020, the number of land transaction permits has exceeded 12,000. The approval rate compared to the number of applications was close to 100%.
According to data submitted by Seoul City to Hwang Hee, a member of the Democratic Party of Korea, on the 13th, the number of land transaction permits from 2020 to last month was recorded at 12,828. During the investigation period, the number of land transaction permit applications was 12,906, resulting in an average approval rate of 99.4%.
The number of permits by year increased from 707 in 2020 to 1,669 in 2021. Due to the impact of interest rate hikes leading to a transaction slump in 2022, the number decreased to 1,399, but then sharply increased to 3,389 in 2023 and 4,490 in 2024. While the increase in designated land transaction permission areas had an effect, it is also analyzed that the preference for a "smart single home" due to multi-homeowner regulations led to concentrated buying in Gangnam and major reconstruction complexes.
Looking at the number of permits by district, Gangnam-gu had the highest number of permits at 4,344, accounting for 33.9% of the total permits in Seoul. It was followed by Songpa-gu with 2,743, Yangcheon-gu with 1,845, Yeongdeungpo-gu with 592, and Seocho-gu with 434.
There were only 76 cases where permission was denied. Reasons for rejection included unsuitability for actual residence purposes (30 cases), failure to meet agricultural or forestry management standards (26 cases), unsuitability for self-management purposes (10 cases), and failure to meet rental business conditions or preservation requirements (8 cases).
In the market, voices are raising doubts about the effectiveness of the land transaction permission system. This is because, except for gap investments, the majority of transactions based on actual residence were approved. The land transaction permission system requires obtaining permission from the district mayor when purchasing real estate within regulated areas, with a mandatory actual residence period of over two years, thereby prohibiting gap investments.
Moreover, even after the designation of the land transaction permission zones, Gangnam-gu recorded the highest number of permits, continuing the trend of driving up housing prices. This has led to criticism that housing prices within the permission zones are not being controlled, while property owners’ property rights are increasingly infringed.
Assemblyman Hwang Hee pointed out, "The original purpose of land transaction permission zones is to apply to lands planned for development, such as new town developments or road construction, to prevent speculative forces from entering." He added, "It is not desirable to apply this in the middle of densely populated urban areas."
He further stated, "Designating only a few specific areas as land transaction permission zones and regulating them will not solve real estate problems," adding, "Rather, increasing the proportion of public land acquisition would help stabilize the market."
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