In the property market, people typically focus on purchase and sale prices. But recent changes run deeper than price. The financing costs of continued ownership, the tax structure at the point of sale, and the possibility of deductions for homes not actually occupied by their owners are all shifting at the same time. The center of gravity in policy is moving from regulating the acquisition stage to addressing how already-owned homes are maintained and when they should be disposed of.
Loans — Holding On Becomes Harder
Starting April 17, 2026, multi-home owners and registered rental operators will, in principle, face restrictions on extending the maturity of mortgage loans on apartments located in the Seoul metropolitan area and regulated zones. Limited exceptions are recognized — for instance, where a tenant is in place, maturity extensions are permitted until the end of the existing lease. In addition, when a person without a home acquires a property that already has a tenant, the obligation to move in is deferred until the end of the lease, subject to certain conditions. Aside from these exceptions, however, continuing to hold property on the assumption that the loan maturity will simply be extended is no longer a given.
Consider Mr. A, in his 50s, who owns two apartments in Gangnam. His loan matures in July. Both units are leased to tenants, and he himself rents on a jeonse basis (a Korean lease system requiring a large lump-sum deposit instead of monthly rent) in Bundang. Previously, he would have rolled over the loan. Now he must weigh his options. Should he sell one unit to repay the loan, wait for the lease to end and sell to an end-user without a home, or move in himself? The loan maturity has become the trigger for reviewing his entire holding strategy.
Capital Gains Tax — The Importance of Timing
On May 9, the moratorium on heavier capital gains tax for multi-home owners ended. The four-year period of relief — running from May 10, 2022 — that had excluded multi-home owners in adjustment target areas from the heavier rates and allowed them to apply the special long-term holding deduction (hereafter "long-term holding deduction") came to a close. According to guidance from the National Tax Service, however, the heavier tax does not apply where a valid sales contract was concluded before May 9, the payment of the down payment can be verified through financial transaction records, and the transfer is completed within a set period. The standard is four months from the contract date for Gangnam, Seocho, Songpa, and Yongsan, and six months for other adjustment target areas.
Take the case of Mr. B, who owns two apartments in Songpa. Assume he sells for 1.5 billion won an apartment he bought 10 years ago for 800 million won, producing a capital gain of 700 million won. If he concluded a valid sales contract before May 9, can verify the down payment, and completes the balance payment and registration within the prescribed period, he can benefit from the moratorium. If, on the other hand, the transaction takes place after May 9 and falls under the heavier-tax regime, a surcharge is added on top of the basic rate, and the long-term holding deduction becomes difficult to apply. Even with the same asset and the same price, the difference between the contract date and the balance payment date alone can dramatically alter the tax burden.
Long-Term Holding Deduction — From "Long Held" to "Actually Lived In"
Discussions over reforming the long-term holding deduction signal the direction of policy. On April 27, Rep. Choi Hyuk-jin and 12 others introduced an amendment to the Income Tax Act. The bill would abolish the deduction based on holding period and retain only the deduction based on residency period, raising the maximum to 80%. The legislation is still under discussion, and the timing of implementation and transitional measures have not been set, but the possibility of reform is being raised in earnest by the government and the political community.
The most directly affected group for the average reader is single-home households whose sale price exceeds 1.2 billion won. Where the requirements for the single-home, single-household tax exemption are met, the portion up to 1.2 billion won is, in principle, not taxed. The implications of the reform debate, however, are not limited to high-priced single-home owners. Owners of single homes who do not reside in them, those leasing out properties, and even holders of non-residential assets such as land and commercial buildings could be affected.
Consider Ms. C, who is selling for 2 billion won an apartment in Mapo that she bought 10 years ago for 1 billion won. The taxable capital gain is 400 million won (only the portion above 1.2 billion won is taxed). If Ms. C held the property for 10 years but lived there only two years because of school district considerations, under current rules she would receive a combined deduction of 48% — 40% for holding and 8% for residency. A simple calculation puts her tax burden at around 60 million won. If the amendment passes, only the residency-based deduction would apply, and her tax burden could rise to the low 100-million-won range. By contrast, Mr. D, who lived in the same kind of home for 10 years, would receive an 80% deduction under either the current rules or the amendment, leaving his tax burden largely unchanged.
In the past, the simple fact of long-term holding carried weight in the tax code. Going forward, whether the owner has actually resided in the home is likely to matter more.
Property Now Demands an Integrated Judgment
Ultimately, the post-May 2026 property regulatory environment moves beyond the question of "how strictly to regulate multi-home owners." It is shifting toward grounding tax protection for homeownership not in the mere length of holding, but in actual residency. Holding property is no longer simply a matter of asset choice — it has become a regulatory question in which loans, taxes, and actual-residency requirements are intertwined.
A personal property strategy can no longer be built on price forecasts alone. When does the loan mature? Does the sale fall before or after the tax cutoff date? Do the actual-residency requirements apply? If the long-term holding deduction reform passes, what would it mean personally? These factors must be considered together. After May 2026, decisions on holding property can no longer be made on the basis of price outlook alone. With loan maturities, sale timing, actual residency, and the possibility of long-term holding deduction reform all working in tandem, holding itself has become a regulatory, tax, and financing decision.
