00:00before you make any move in korea's property market the rules just shifted again under the government's plan a non
00:06-resident owner of a two billion one home would see their property tax drop from five point three million one
00:11to one point nine million one and one party is pushing for an even higher exemption
00:16policy whiplash is now the story it's tuesday november 10th let's look at what's happening in korea's property market three
00:23things move this week that matter for anyone buying holding or financing a home in seoul here's what the numbers
00:29show in august the government proposed cutting the basic deduction for non-resident single homeowners from one point two billion
00:35one to nine hundred million one in september it reversed course and returned the deduction to one point two billion
00:42one for a home assessed at two billion one the annual tax bill moved
00:46from two point two seven million one under the current system to five point three one million one under the
00:52august plan to two point seven seven million one under the september version under the ruling party's proposal it falls
00:59to one point nine million one analysts estimate roughly forty seven thousand households nationwide would pay less and about forty
01:06two thousand of them are in seoul meanwhile the government says it cannot accept the higher deduction its stated goal
01:12is to lower the tax burden on owner occupiers while normalizing taxes on
01:16homes left empty and extending the deduction to non-residents works against that now banpo hindai renamed banpo centerville esterium
01:24the sole socho district office sent the reconstruction group a charge notice averaging two hundred twenty three point seven five
01:31million one per member that is roughly sixty five percent higher than the twenty eighteen estimate of the same project
01:37the group plans to appeal and it argues that the baseline price growth used in the calculation understates actual home
01:43price gains
01:44the district says the district says that once additional rental housing appraisals are included the average per member could fall
01:49to the low one hundred million one range
01:55but the real problem is timing projects often take eight to ten years from approval to completion and the gap
02:04between the estimate and the final bill keeps widening experts say the government needs to publish clear calculation rules and
02:11a firm collection deadline because without them the next big projects in yunma and jamsil face the same confusion on
02:17the construction side the numbers are equally stark
02:20construction company closures rose 27.4 percent through september to 3 274 which works out to about 12 a day
02:29general contractor closures jumped 33.7 percent in the same period construction employment fell 2.4 percent from a year
02:36earlier and insured construction workers have declined for 38 straight months construction costs reached an all-time high in september
02:44nearly 40 percent above their 2020 level
02:46companies are taking on work they cannot profitably complete and interest costs are eating into operating profit the number of
02:53construction firms unable to cover interest from operating earnings for three straight years rose from 62 in 2021 to 173
03:01last year at the same time a separate bill to reduce the penalty for fatal accidents at construction sites is
03:07moving forward with a proposed cap of one to two percent of sales down from three percent regulators say deaths
03:14fell 28.6 percent but the
03:16industry argues it is being squeezed on three sides so what does this mean for buyers weighing a purchase this
03:22year first the tax rules you plan around may still change so model more than one scenario before committing second
03:28if you're considering a reconstruction project check whether a redevelopment charge has been issued and ask the builder for the
03:35latest estimate not the original one third construction slowdowns can stretch delivery timelines so confirm completion dates in writing earlier
03:43we said that policy whiplash is now the story
03:45here's what that actually means for you the property tax you pay next year could depend on a decision that
03:51hasn't been finalized yet what to watch watch the final property tax version the banpo appeal and the construction penalty
03:58bill that's today's ai prism real estate this episode was produced with ai assistance based on seoul economic daily reporting
04:06ai prism is a juan ifra award-winning series we'll be back tomorrow
