Foreigners Buying a Second Home in Korea: When Does the 8% or 12% Acquisition Tax Apply?

Buying a second home in Korea can trigger different acquisition tax rates depending on household home count and location.

You already own an apartment in Korea.

Now you are considering another one.

Perhaps the first apartment is in Seoul and the second will be purchased under your spouse’s name. Your spouse still lives overseas, and your family also owns property in another country.

A seemingly simple question suddenly becomes expensive:

Will Korea treat the new apartment as a second home?

For acquisition tax, the answer cannot be determined only by whose name appears on the new contract.

Korea’s multiple-home acquisition tax rules look at the number of qualifying homes held by a household. The rules also expressly recognize foreign-registration records when determining that household.

But there is an important limit that foreign buyers often miss:

The home-count rule is based on homes and specified housing rights held in Korea.

Owning houses overseas does not, by itself, increase the domestic home count used for this acquisition-tax surcharge.

Foreign Buyers Are Not Outside the Household Rules

A foreign buyer should not assume that Korea’s multiple-home acquisition tax applies only to Korean citizens.

Article 28-3 of the Enforcement Decree of the Local Tax Act defines a household by reference not only to Korea’s resident registration record but also to registered foreigner records under the Immigration Act.

That matters when a foreigner already owns residential property in Korea and acquires another home.

The tax question is therefore not simply:

“How many homes are registered in my name?”

A better question is:

“How many qualifying homes and housing rights in Korea are counted for my household on the acquisition date?”

When Does a Second Home Trigger the 8% Rate?

The location of the newly acquired home matters.

Under the Local Tax Act, acquisition of a second home by a household in an adjustment-target area can be subject to the heavy acquisition-tax rate. A third home outside an adjustment-target area can also trigger a higher rate.

The basic rate structure is:

In an adjustment-target area:

First home: generally 1% to 3%
Second home: 8%
Third home or more: 12%

Outside an adjustment-target area:

First home: generally 1% to 3%
Second home: generally 1% to 3%
Third home: 8%
Fourth home or more: 12%

Corporations are generally subject to a separate 12% heavy-rate structure for covered residential acquisitions.

This produces an important difference for an individual buyer.

If your household already owns one Korean home and acquires another home in an adjustment-target area, the new acquisition can fall into the 8% category.

If the second home is outside an adjustment-target area, simply becoming a two-home household does not automatically produce the 8% rate.

The designation therefore needs to be checked for the relevant acquisition date.

Does Your Spouse’s Korean Home Count?

Potentially, yes.

For acquisition-tax purposes, a spouse is generally treated as part of the same household even when the spouse is not recorded on the same resident or registered-foreigner record.

This is particularly important for international families.

Suppose you live in Korea and own one apartment here.

Your spouse lives overseas but owns another apartment in Korea.

Buying a new apartment solely in your name does not automatically make the transaction a “first home” simply because you and your spouse live in different countries.

The spouse rule must still be applied.

The key issue is the household’s count of relevant Korean homes, not merely the buyer’s individual ownership history.

What About an Unmarried Child Under 30?

The rule is more nuanced than “everyone under 30 is automatically included.”

As a starting point, an unmarried child under age 30 can be treated as belonging to the purchaser’s household even when not recorded together.

But the Enforcement Decree provides an exception for certain adult children under 30 who live separately, meet the prescribed income requirement and are able to maintain an independent livelihood. Minors do not qualify for this exception.

So age alone does not settle the question.

For an international family with an adult child studying or working overseas, the relevant issue is whether the statutory separate-household conditions are satisfied—and whether that family member owns residential property in Korea that affects the calculation.

Do Homes in New York, London or Tokyo Count?

This is where the rule becomes much clearer.

Article 28-4 of the Enforcement Decree provides that the household home count for these acquisition-tax rules includes relevant homes and specified housing rights owned in Korea.

The words “in Korea” matter.

If you own three houses outside Korea but no home in Korea, those overseas houses do not become three Korean homes for this particular acquisition-tax calculation.

Buying your first qualifying home in Korea therefore does not become a “fourth home” merely because you own three houses abroad.

Likewise, if you own one home in Korea and several overseas properties, the overseas properties do not by themselves turn your next Korean acquisition into a third or fourth domestic home.

This conclusion is limited to the Korean acquisition-tax home count discussed here. Overseas property may matter for other tax, reporting or financial questions.

A Home Count Can Include More Than Completed Apartments

Do not check only completed homes.

Article 28-4 also brings specified housing-related rights into the home-count calculation, including certain association occupancy rights, housing presale rights and officetels.

This can matter before another apartment has even been completed.

For example, a household that says, “We own only one apartment,” may still need to check whether a spouse or another household member holds a Korean presale right or redevelopment-related housing right that is counted under the acquisition-tax rules.

There are also statutory exclusions for particular types of housing and rights.

So the safest question is not simply how many apartments the family owns, but how many qualifying Korean homes and housing rights are counted under the current rules.

What If the Second Home Is Temporary?

A temporary two-home exception can change the result.

Under Article 28-5 of the Enforcement Decree, a household that owns one existing home or relevant housing right and acquires another home for a qualifying reason can receive temporary two-home treatment if the previous home or right is disposed of within the statutory period.

The current disposal period is three years.

This means that purchasing a second home in an adjustment-target area does not automatically mean the buyer ultimately bears the 8% multiple-home rate.

But intention alone is not enough.

Saying “I plan to sell the old apartment later” does not by itself establish the exception. The transaction must satisfy the statutory temporary two-home conditions, including disposal within the required period.

Check the Area Again Before the Acquisition

The 8% and 12% rates depend partly on whether the newly acquired home is located in an adjustment-target area.

Those designations can change.

Current Seoul local-government guidance identifies all of Seoul as an adjustment-target area. For property elsewhere, the designation applicable to the relevant acquisition should be checked rather than assumed from an old article, video or tax calculator.

This is why two households with the same number of Korean homes can face different acquisition-tax results when they buy in different locations.

A second home in an adjustment-target area and a second home outside one are not necessarily taxed the same way.

Four Things to Check Before Buying Another Korean Home

Before signing or closing on an additional apartment, start with the household.

Identify the purchaser, spouse and family members who may be included under the acquisition-tax household rules. If an unmarried adult child under 30 is involved, check whether the statutory separate-household exception applies.

Next, count the relevant residential assets in Korea.

Do not add overseas homes merely because they are residential property. But do check Korean homes and qualifying housing rights held by household members.

Then check the location of the new property.

If the household already owns one counted home, buying another in an adjustment-target area can produce the 8% rate, while a second home outside such an area generally remains within the ordinary residential acquisition-tax rate structure.

Finally, check whether an exception applies.

Temporary two-home treatment is one example, and other statutory exclusions can also affect the final home count.

The Key Point for Foreign Buyers

Foreign citizenship does not make Korea’s household-count rules disappear.

The acquisition-tax rules expressly recognize registered-foreigner records when determining a household, and a spouse can be treated as part of the same household even when separately recorded.

But Korea does not simply count every house your family owns anywhere in the world.

For the multiple-home acquisition-tax calculation discussed here, the law focuses on qualifying homes and housing rights held in Korea.

So before buying another apartment, determine three things:

Who belongs to your household for acquisition-tax purposes?

What qualifying residential assets does that household already hold in Korea?

And what rules apply to the new property on the acquisition date?

Those answers—not nationality alone, not whose name appears on the contract, and not the number of homes your family owns overseas—determine whether the ordinary acquisition-tax rate or an 8% or 12% multiple-home rate may apply.

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