June 19, 2024

As Chinese property ownership in South Korea triples, locals ‘struggle to buy a home’, politician says

The amount of land owned by Chinese nationals in South Korea has more than tripled since 2016 – the latest in a series of statistics on Chinese nationals’ buying property amid growing concerns over housing prices.

Citing data from the Ministry of Land, Infrastructure and Transport on Tuesday, Hong Suk-joon of the ruling People Power Party (PPP) said 181,391 lots of land nationwide were owned by foreign nationals as of last June.

A lot is a unit of land that is available for building a house or other forms of residence, with varying size depending on regions, population density and other real estate-related conditions.

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Some 72,180 of the 181,391 properties belonged to Chinese nationals, up from 24,035 in 2016.

The total combined size of the real estate increased to 20.81 million square meters from 16.09 million square meters over the cited period.

The value of the properties also increased to 3.69 trillion won (US$2.77 billion) from 2.84 trillion won.

“The data adds to concerns over a housing crisis as it shows Chinese nationals can increasingly go on a property shopping spree while many Koreans are struggling to buy a home,” the lawmaker said.

I am afraid that a Chinese buying spree can put upward pressure on housing prices

Hong Suk-joon, People Power Party member
He said South Korea does not restrict Chinese nationals from owning land or housing here, while regulations restrain Korean citizens from doing so in China in the name of preventing speculative investments.

The lawmaker pointed out that by not allowing Korean nationals to own land there, China goes against the principle of reciprocity in international relations.

“I am afraid that a Chinese buying spree can put upward pressure on housing prices, and that Koreans living in our own land may end up as tenants of housing owned by Chinese nationals,” Hong said.

Residential buildings in Seoul, South Korea. Of the more than 87,000 foreign owned properties, Chinese nationals owned about 54.3 per cent, more than double that of US citizens, who were in second. Photo: Bloomberg

Separate data from the land ministry showed that Chinese nationals possessed more than half of all housing held by foreign nationals as of June 2023.

Foreign nationals owned a combined 87,223 homes, accounting for 0.46 per cent of all housing in the country.

Of the 87,223 homes, Chinese nationals owned about 54.3 per cent, more than double that of US citizens, who were in second, and accounted for 23.5 per cent.

Data from the Financial Supervisory Service (FSS) showed the outstanding balance of housing mortgage loans for foreigners offered by the four major commercial banks – KB Kookmin, Shinhan, Hana and Woori – amounted to 2.3 trillion won in the first half of 2023.

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The amount was up 3.3 per cent from a year earlier, amid a steady increase in foreign nationals’ total housing loan balance.

It was 2.05 trillion won at the end of 2019 but rose to 2.23 trillion won at the end of 2020, and then to 2.29 trillion won at the end of 2021.

The outstanding balance for Chinese nationals in the January-June period of 2023 accounted for 1.33 trillion won, or 57.9 per cent of the total.

The 1.33 trillion won represented a 24.4 per cent increase from 1.07 trillion won at the end of 2019.

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