{"id":133461,"date":"2026-08-27T02:18:15","date_gmt":"2026-08-27T02:18:15","guid":{"rendered":"https:\/\/www.europesays.com\/korea\/133461\/"},"modified":"2026-08-27T02:18:15","modified_gmt":"2026-08-27T02:18:15","slug":"seoul-nears-deal-on-floor-area-boost-and-greenbelt-release","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/korea\/133461\/","title":{"rendered":"Seoul Nears Deal on Floor-Area Boost and Greenbelt Release"},"content":{"rendered":"

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\u25b2 AI PRISM* Personalized Economic Briefing<\/p>\n

* Editor’s note: AI PRISM (Personalized Report & Insight Summarizing Media) is an artificial intelligence-based personalized news recommendation and summary service developed with support from the Korea Press Foundation. It selects and provides six news items tailored to each reader type.<\/p>\n

\u25a0 Seoul supply deal takes shape: The Ministry of Land, Infrastructure and Transport (MOLIT) is actively reviewing a plan to raise the floor area ratio for private redevelopment projects to 1.2 times the current level, and the Seoul Metropolitan Government estimates the move could secure an additional net gain of 43,000 homes by 2031. With Seoul shifting to a more open stance on releasing greenbelt land, the case for reassessing the investment value of redevelopment complexes and land near greenbelt areas is growing.<\/p>\n

\u25a0 Comprehensive property tax revision comes into focus: The government is understood to be leaning most strongly toward keeping the basic exemption on the comprehensive real estate holding tax for non-resident single-home households at the current 1.2 billion won, above the 900 million won in its original proposal. The exemption for owners who live in their single home is set to rise to 1.4 billion won, making the gap in tax burden based on residency a key variable in shaping investment strategy.<\/p>\n

\u25a0 Tax support widens for non-apartment housing: The Ministry of the Interior and Safety announced a local tax revision plan that expands first-time acquisition tax relief for young people under 40 to small officetels \u2014 units of 40 square meters or less with a standard market value of up to 400 million won in the greater Seoul area \u2014 and raises the relief cap from 2 million won to 3 million won. The plan also allows the relief to be applied again when a buyer sells an officetel and purchases an apartment, which is likely to draw owner-occupier demand into the income-property market.<\/p>\n

[News of Interest to Real Estate Investors]<\/p>\n

1. Common Ground Found on 1.2-Fold Floor Area Boost and Seoul Greenbelt Release<\/a><\/p>\n

Key summary: Seoul Mayor Oh Se-hoon and Land Minister Kim Yun-duk met on the 26th and narrowed their differences on housing supply measures. Seoul proposed that raising the floor area ratio by 1.2 times at redevelopment and rebuilding sites that have received association establishment approval could secure an additional net gain of 43,000 homes by 2031, and Oh called it “the most effective and visible volume of construction starts among the items discussed in this consultation.” On releasing greenbelt land, Seoul shifted to a stance of open review on the condition that housing supply within Yongsan Park be withdrawn, and the two sides agreed to hold further talks next week. Because the profitability of redevelopment projects improves once a floor area increase is confirmed, there is an urgent need to reassess the investment value of sites that have passed the association establishment approval stage.<\/p>\n

2. Exemption for Non-Resident Single-Home Owners Likely to Stay at 1.2 Billion Won<\/a><\/p>\n

Key summary: The government is strongly considering keeping the basic exemption on the comprehensive real estate holding tax for non-resident single-home households at the current 1.2 billion won rather than the 900 million won in its initial proposal. The exemption for owners living in their single home is set to rise from the current 1.2 billion won to 1.4 billion won, which is expected to narrow the gap in tax burden based on residency compared with the original plan. A government proposal to raise the cap on tax increases from the current 150% to 200% is also under review, and the final direction is expected to be decided at a Cabinet meeting on Sept. 1. For non-resident single-home owners, the scenario of a sharp jump in tax burden could ease somewhat, so they need to confirm the outcome of the September Cabinet meeting before finalizing whether to sell or hold.<\/p>\n

3. Officetels Added to First-Time Acquisition Tax Relief; Up to 3 Million Won for Young Buyers<\/a><\/p>\n

Key summary: Under the 2026 local tax revision plan announced by the Ministry of the Interior and Safety, people under 40 will be able to receive up to 3 million won in acquisition tax relief when they first buy a small officetel of 40 square meters or less with a standard market value of up to 400 million won in the greater Seoul area. If they later sell the small officetel and buy a home, the first-time acquisition tax relief can be applied once more, for a combined benefit of up to 6 million won. The acquisition tax relief rate for rental housing built under purchase agreements by public housing operators such as Korea Land & Housing Corporation (LH) and Seoul Housing & Urban Development Corporation (SH) will also be raised sharply from the current 15% to 70% in 2027, in a bid to accelerate rental housing supply. With owner-occupier demand for small officetels likely to widen, investors in income-generating officetels should examine both the relief requirements and shifts in rental demand.<\/p>\n

[Reference News for Real Estate Investors]<\/p>\n

4. Fixed-Rate Share of Mortgages Hits 12-Year, 5-Month Low<\/a><\/p>\n

Key summary: According to the Bank of Korea’s weighted average interest rates of financial institutions for July, the share of fixed-rate loans among new mortgages fell 5.8 percentage points from the previous month to 31.9%, the lowest level since February 2014. Fixed-rate mortgages carried an annual rate of 4.76%, 0.41 percentage point higher than the 4.35% on floating-rate loans, pushing consumers toward floating rates. Because interest costs for floating-rate borrowers could rise if market rates climb, a more cautious approach is needed in choosing between fixed and floating rates when taking out loans for long-term investment.<\/p>\n

5. 24-Story Office Building in Daechi-dong, COEX Expansion Approved<\/a><\/p>\n

Key summary: The Seoul Metropolitan Government’s architecture committee approved the construction of a large office building of about 50,000 square meters in total floor area, spanning nine basement levels to 24 above-ground floors, at 890-16 Daechi-dong in Gangnam District. COEX in Samseong-dong will also strengthen its exhibition and convention functions through an expansion and remodeling covering 972,598 square meters of total floor area, and two direct pedestrian passages will be newly built linking it to the Yeongdong-daero multi-modal transfer center, concentrating business infrastructure in the southeastern part of the city. Stronger business and commercial functions in the Daechi and Samseong areas are expected to lift rental demand and locational value for nearby office and retail assets.<\/p>\n

6. NH NongHyup Bank Resumes Refinancing From Other Banks, 40-Year Mortgages<\/a><\/p>\n

Key summary: NH NongHyup Bank will resume handling mortgages for the purpose of refinancing loans from other banks starting on the 31st, after suspending them in May, and will restore the maximum maturity on mortgages outside the greater Seoul area to 40 years from 30 years. It will also lift restrictions on mortgage credit guarantees (MCG), which is expected to increase the loan limit available against the same collateral. With financial authorities having notified each bank of readjusted household loan volume targets, other banks are also likely to gradually ease their own restrictions with a focus on owner-occupier demand.<\/p>\n

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