Comprehensive real estate tax rises for first time in 3 years as home prices surge

South Korea's comprehensive real estate tax on housing rose for the first time in three years, driven by a sharp jump in publicly assessed home prices. With the government signaling a possible property tax overhaul by the end of next month, homeowners are bracing for an even heavier burden ahead.

The final assessed amount of the comprehensive real estate tax — known as jongbusae — on housing for the 2024 tax year came to about 1.09 trillion won ($704 million), up about 138.9 billion won, or 14.6 percent, from the previous year, according to data from the Ministry of Statistics' national statistics portal KOSIS.

It marks the first increase in the annual housing jongbusae since 2021, when the tax surged 202.2 percent.

The rise reflects higher publicly assessed prices. Average assessed prices in 2024 were up 0.57 percent for standard single-family homes nationwide and 1.52 percent for apartment complexes and multi-unit residential buildings compared with the previous year.

A notable feature of the 2024 figures is that owners of one or two homes saw steeper increases than those with three or four. The tax rose 17.6 percent for single-home owners and 21.1 percent for two-home owners, compared with 8.7 percent for those with three homes and 1.8 percent for those with four.

The number of people subject to the housing jongbusae reached 455,331 in 2024, up 11.5 percent from the previous year — the first increase in two years. That figure, however, represents only 38.1 percent of the peak of about 1.19 million recorded in 2022.

The tax burden is expected to keep climbing. Assessed prices have risen more broadly since 2025: standard single-family home prices rose 1.97 percent in 2025 and 2.51 percent this year, while apartment and multi-unit prices climbed 3.65 percent in 2025 and 9.13 percent this year, widening the gap.

Given that trajectory, the jongbusae for the 2026 tax year — assessed as of June 1 and payable in December — is expected to rise at an even steeper rate.

How fast the tax climbs from here will depend on the direction of the tax reform the government plans to announce by the end of next month. The government is reviewing a range of tools to stabilize the housing market, with real estate taxation among the options under consideration.

President Lee Jae Myung, at a press conference marking his first year in office on June 8, raised the possibility of strengthening the holding tax on non-owner-occupied homes. "There's nothing wrong with owning multiple properties," he said, "but they should bear a corresponding burden."

Raising the tax base or rates set out in the Comprehensive Real Estate Tax Act, or lifting the fair market value ratio — currently around 60 percent — could push the jongbusae sharply higher when combined with rising assessed prices.

However, some analysts caution that a blanket increase tied to assessed prices could disproportionately burden single-home retirees with limited income, given the broad rise in home prices — particularly in the Greater Seoul area.

The law caps the combined increase in property and comprehensive real estate taxes at 50 percent over the previous year. Some apartments in the three Gangnam districts have already hit that ceiling this year due to sharp jumps in their assessed prices, meaning that raising the tax rate or the fair market value ratio may have little practical effect on those properties.

Within and around the government, there is growing expectation that any reform will be targeted — focusing on multi-home owners and owners of ultra-high-value properties rather than single-home owner-occupiers.

Kim Yong-beom, the presidential chief of staff for policy, said at a recent Kwanhun Club forum that his office has been running repeated simulations on real estate tax reform, including the holding tax, and pledged to set rates "at a level that people can reasonably accept."

The government plans to hold a public forum on real estate policy in mid-July, bringing together officials from relevant ministries, experts and ordinary citizens, before finalizing the direction of the real estate tax overhaul.