State-declared real estate value frozen for third straight year

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State-declared real estate value frozen for third straight year

Published: 19 Nov. 2024, 18:16

SHIN HA-NEE
[email protected]

Apartment buildings seen from Mount Namsan in central Seoul on Monday [YONHAP]

The government will hold the state-declared value of condos frozen at 69 percent their market value next year, meaning owners' property taxes will not rise on a policy basis, the Ministry of Land, Infrastructure and Transport announced Tuesday.

The announcement is a continued departure from the previous Moon Jae-in administration's plan to tax homeowners based on values closer to the current market rates of their properties.

The Korean government calculates number of tax measures, including property taxes, health insurance fees and national pension premiums, based on the state-declared value of a resident's real estate holdings. Property taxes still rise and fall based on fluctuations in market prices.

In 2020, the Moon Jae-in administration announced a plan to gradually raise state-evaluated real estate prices to as high as 90 percent of their market value by 2035, with an aim to tax homeowners based on the actual value of their property.

President Yoon Suk Yeol vowed to scrap Moon’s real estate policy in March but failed to secure parliamentary approval for the necessary legislative revision. His administration has now held the declaration rate steady at 69 percent of market price for condos, or privately owned apartment units, for a third consecutive year. Rates for single-family homes and land lots also remained at 53.6 percent and 65.5 percent, respectively.

Under Moon Jae-in's proposal, the declared price would value been 78.4 percent of the actual price for condos, 66.8 percent for single-family homes, and 80.8 percent for land.

While a bill to revise related laws was proposed to the National Assembly in August, but with the liberal Democratic Party holding a majority in the legislature, the revision's future remains uncertain.

BY SHIN HA-NEE [[email protected]]