In the future, if a vacant house is demolished and the vacant land is transformed for public purposes such as parks or parking lots, property tax payments may be reduced during the usage period. The budget allocated for supporting the demolition costs and other expenses related to maintaining vacant houses has also doubled from 5 billion won last year to 10 billion won this year. The aim is to actively encourage vacant house maintenance by lessening the tax burden, expenses, and administrative costs associated with the demolition of vacant houses.
The Ministry of Interior and Safety, the Ministry of Land, Infrastructure and Transport, the Ministry of Agriculture, Food and Rural Affairs, and the Ministry of Oceans and Fisheries announced the 'Comprehensive Plan for Vacant House Management' during the Economic Relations Ministers' Meeting and the Industrial Competitiveness Ministers' Meeting chaired by Deputy Prime Minister and Minister of Economy and Finance Choi Sang-mok on the 1st.
◇ "I demolished the vacant house, and now it's a 'tax bomb'... Government eases expense burden
The government has decided to ease the tax burden incurred from the demolition of vacant houses. 'Land' incurs 1.5 times more property tax than 'dwellings,' which has led to many owners not demolishing vacant houses and simply leaving them abandoned. The government will impose the same property tax after demolition as it would for dwellings. Previously, such benefits applied only for 'five years after demolition,' but if transformed into public purposes like parks or parking lots, the benefits will continue.
There was also a problem where the capital gains tax incurred when selling the land after demolishing a vacant house was 10 percentage points higher than when it was a dwelling. The government has excluded this additional capital gains tax for two years after demolition, but now it has revised the regulations to exclude it for five years.
The government will provide more support for the expenses incurred in the vacant house maintenance project. Currently, the government supports demolition expenses of up to 10 million won for urban areas and 5 million won for rural areas, with 70% covered by national funds and 30% by local governments. The Ministry of Interior and Safety has doubled the budget for vacant house maintenance projects from 5 billion won last year to 10 billion won this year.
Prior to demolishing a vacant house, there was a problem where costs amounting to 500,000 to 1 million won were incurred to obtain a 'dismantling plan' from experts. The government is working to allow the submission of dismantling plans to be omitted for 'small buildings.'
◇ To allow transactions of vacant houses on Zigbang and Carrot... Support for utilization in accommodation businesses
The government aims to activate transactions of vacant houses and support their transformation into accommodation facilities, among other uses. Currently, using the platform 'BinHouse' operated by the Korea Real Estate Board, the status of vacant houses will be disclosed in detail, and legal reviews will be undertaken to enable direct transactions of vacant listings on platforms like Zigbang and Carrot.
Additionally, the government plans to establish new industries such as 'Rural Vacant House Regeneration Accommodation' and 'Vacant House Management' to assist the private sector in operating vacant houses as accommodation facilities. Currently, a startup like 'Dajayo' is receiving special exemptions to freely lease vacant houses in Jeju Island and remodel them into accommodations for lending. The government has decided to institutionalize these forms of business to promote activation.
Moreover, the government plans to enact the 'Special Act on Rural Vacant House Management' and the 'Special Act on Vacant Building Management.' This is to transfer the responsibility of managing vacant houses, which had previously been entrusted to local governments, to the national and provincial governments. The government will also enhance financial support for vacant house maintenance using funds such as the Local Extinction Fund, Hometown Love Donation Program, and the Rural Community Cooperation Fund.
Vice Minister Kim Min-jae noted, "With low birth rates and aging, it is expected that the occurrence of vacant houses will accelerate in the future," adding that municipalities with a high number of vacant houses are likely to have poor administrative and financial conditions, thus emphasizing the significance of this comprehensive plan. According to the Ministry of Interior and Safety, last year, among 134,009 vacant houses nationwide, nearly half, or 57,223 houses, were located in areas experiencing population decline.