Property for sale in Canada

South koreans snapping up property in other markets

Strategies adopted by the government in order to facilitate the unrestrained outflow of capital from the South Korean markets seem to have met with success. According to the present scenario, South Korea is acting as a source of foreign investment, not as an investment opportunity for foreigners. In effect, South Koreans buying up other markets.In fact, the out flux of money away from South Korea has been so unexpected that the property purchases in foreign countries by South Korean residents actually rose by a whopping 57%. In 2006, South Korean individuals spent around $750 million in purchases of foreign property whereas last year that number surged to approximately $1.2 billion. For a country the size of South Korea, those are very significant amount of funds vacating the country's economy.While the most sough after countries for these purchases were the United States and Canada, Asian countries such as Singapore and Malaysia also felt a significant influx of cash into their property markets because of the outflow of cash from South Korea.This new trend actually represents a victory of sorts for the South Korean government, which has been lively in its commitment to deflate their currency enough to end the charge it has made against the US greenback in recent months. With a failing US currency (the currency that at the moment stabilizes most of the world), many in South Korea have been in utter panic concerning the increased value of their currency and that has resulted in the South Korean government utilizing capital outflow techniques so as to bring down the value of the South Korean currency.One of the techniques they employed was to increase foreign property investment to $3 million for the 2007 year, a decision that has clearly done exactly what they intended it to do.While other Asian housing markets have been marching ahead, Korea has been undergoing an almost complete pause in its residential property transactions over the past year. Volumes have cut down to insignificance. Prices have hardly progressed. Realtors are in agony.The downturn came after a wave of buying euphoria which spread all over the country, pushing the housing index up in a mini-boom, particularly in Seoul. Residential prices in South Korea climbed 11.60% in 2006 (a 9.32% price increase in real terms). But they then only surged 3.08% in 2007 (a reduction of 0.50% in real terms). House prices have rose 23.9% over five years to end-2007, and 64.6% over ten years.Seoul's most famous neighborhoods, three-bedroom apartments can now be priced at $2 million, about 100 times the average national income. The President Roh Moo Hyun established a number of measures to slow price gains, among the most powerful of which was to increase capital gains taxes by as much as 60%, and to restrict the size of some bank loans so that monthly payments do not go beyond 40% of a borrower's monthly income.All in all, demand is staying very low for property in the South Korean housing market, while demand has surged in Singapore and Malaysia by very significant amounts. There is no reason to anticipate that 2008 will be any different considering locations chosen by South Korean residents and therefore one can expect property markets in both of those countries to be boosted continually by investment from South Korean residents. These are the reasons why it is echoed across the world that South Koreans buying up other markets.