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While heavy government regulations and a down-sliding economy are making contributions to a freezing of the real estate market, a study has found that Korea has the most severe real estate regulations in the world.
According to a study of major cities in 16 countries released by the Center for Free Enterprise yesterday, Korea got the most points when it came to real estate regulations.
Korea had 16 of a total 19 rule categories.
Local regulations include restrictions on ownership of farmland that is not being used for agricultural purposes.
Singapore trailed closely behind Korea with 11, while Shanghai, Tokyo and Amsterdam jointly placed third.
Hong Kong and Germany had the least real estate regulation.
The survey was conducted among real estate experts in major cities including London and Los Angeles between September and November 2007.
Korea was found to be especially harsh when it came to controlling its housing supply.
It was the only country in the study where the government regulates the price of housing newly built by both the private and public sector or that has laws requiring the disclosure of part of the construction costs of apartments on public land.
Singapore, which also has an abundance of real estate regulations, only partially regulates the distribution of newly built houses according to the condition of the market.
China only controls the prices of new houses built on public property, and Hong Kong only regulates speculation involving public housing.
The study found that 10 countries, including Germany, Japan, Poland and India, did not have government intervention on the distribution or price of newly built apartments.
“It wasn’t easy finding a global standard since real estate-related regulations were extremely complicated and real estate is something that is not imported or exported,” said Kim Jong-ho, head of the Center for Free Enterprise.
Kim said that the study will likely spark discussion on setting regulations that meet international standards.
By Lee Ho-jeong Staff Reporter
Ahn Hai-ri JoongAng Ilbo
