A Study on Investment Opportunities & Perils in Korea for Foreign Real Estate Investors

Abstract

Foreign institutional investors are one of the major groups of investors in the financial sector. Because of their particular characteristics and limitations, 'conventional assets,' such as equities, bonds, and cash, dominate institutional investors' asset allocation. To attain higher and more consistent return profiles, major Korean institutional investors have been rearranging their asset allocation strategies to include more exposure to the real estate industry. Real estate prices grow more efficient and closer to their long-term equilibrium as a result of rules. Any foreigner intending to purchase property in Korea must notify the government, according to the Real Estate Transaction Report, Etc. Act. If a foreign buyer chooses not to file an acquisition report, they must comply with the same legislation (the Act on Real Estate Transaction Report, etc.) that requires the submission of all real estate purchase reports. International investors that invest in designated zones for foreign investment or in firms with foreign ownership that provide certain recognized high-level technology services can additionally benefit from other tax incentives. This study aims to find out, because of these rules and policies, investing in the real estate industry in Korea might seem to be complicated but the after effects of these investments looks much brighter in the future.