FOREIGNERS SUSPECTED OF LAND SPECULATIONS

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The previous report covered politicians being investigated for illegal real estate speculations. Now even foreigners staying in Korea are involved in speculative property deals. Police found a Pakistani national on a trade visa who purchased seven properties and leased them out illegally.

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An urban redevelopment site in Incheon. An apartment complex of 15,000 units is to be built here. The price of residence right jumped from 200 million won to more than 500 million.

[Soundbite] (Real Estate Agent(VOICE MODIFIED)) : "(How much did the price increase?) From around 200 million to 400 million. The prices are high now because people will start moving in around November of 2023."

A Pakistani man obtained the right to live in this apartment when he bought a house here at 200 million won ten years ago, when the area was marked for redevelopment. Later when the house price spiked, he purchased six more properties in the capital region alone. He used the so-called “gap investment,” in which an individual purchases a property currently leased to a jeonse tenant at a price that excludes the jeonse deposit. His properties amount to around 2 billion won in market value. He even registered himself as a lease business operator, which is illegal. That is because the Pakistani national, who exports automotive parts, is in Korea on an international trade visa, which forbids him from operating other types of businesses. While being questioned by the Ministry of Justice, the Pakistani businessman admitted that he had purchased the properties to make profit, but he claimed that he didn’t know about the visa restrictions. Last month, two Chinese students who entered South Korea on a student visa, which disallows any business operation, were transferred to the prosecutors’ office for running a property rental business. With even foreigners jumping into speculative deals as housing prices in Korea skyrocket, the Ministry of Justice is looking into some 47,000 real estate transactions in the past three years involving foreigners.

[Soundbite] Kim Jae-nam(Justice Ministry’s Special Investigative Unit Leader) : "We are currently looking into transactions in the capital region. We plan to expand our investigation to Seoul and other areas with suspected speculative deals."

The Pakistani man’s case was sent to the prosecution for violating the Immigration Act.