Seoul to designate all land classified as roads as land transaction permit zones, block share-splitting

[Financial News] Seoul Metropolitan Government will newly designate land classified as “road” throughout Seoul as land transaction permit zones to block speculative transactions, including the splitting of road ownership stakes into small shares.
Seoul Metropolitan Government said on the 9th that it had made the decision at the 16th Urban Planning Committee meeting held on the 7th. The designation applies only to transactions involving land classified as road; it does not apply to all real estate transactions throughout Seoul.
The designation will last one year. The specific areas and period covered can be confirmed in a notice to be published in the Seoul Metropolitan Government Gazette on the 12th.
Since September 2024, Seoul Metropolitan Government has designated private roads in development projects such as Moa Town as land transaction permit zones to manage speculative transactions.
Recently, however, there have been signs that transactions such as splitting road ownership stakes into small shares are spreading even in areas with little connection to development projects. Concerned that this could lead to conflicts over development projects and delays, the city decided to expand the designation citywide and begin managing the issue proactively.
Designating land transaction permit zones does not prohibit the sale of roads. Normal transactions can still be approved if there is a recognized practical need for the transaction and the applicable approval standards under relevant laws are met.
Seoul Metropolitan Government plans to administer the system in a way that blocks speculative transactions without imposing unnecessary restrictions on normal transactions based on genuine demand. It also set the designation period at one year so it can closely monitor the effects of the designation and its impact on such transactions.
In addition, Seoul Metropolitan Government partially adjusted the boundaries of land transaction permit zones to reflect changes to the project areas of three housing redevelopment sites under rapid integrated planning. The change is intended to facilitate smooth project implementation; the area subject to approval and the designation period remain unchanged.
Within a land transaction permit zone, anyone seeking to enter into a contract to transfer or establish ownership or superficies rights over land exceeding the area subject to approval must obtain permission from the head of the relevant district office. The land must also be used in accordance with the purpose for which permission was granted, such as actual residence or business operations.
Myeong No-jun, head of Seoul Metropolitan Government’s Housing Office, explained, “This designation is not intended to restrict normal transactions involving roads. It is a measure to screen out in advance speculative transactions in which road ownership stakes are split into small shares and traded repeatedly.”
Myeong said, “We will operate the system to prevent harm to citizens from speculative share transactions while ensuring that normal transactions based on genuine demand cause no inconvenience. We will also closely monitor market conditions after the designation.”
[email protected] Kim Hyeong-gu Reporter