Chinese pour money into Jeju property sector
Residents on the Korean resort island are wary of growing domination by the Chinese, saying too much land is being sold too cheaply
The level of Chinese investment in the property sector of South Korea's largest island of Jeju is soaring, rising 49 times between 2010 and the first half of this year. But it is angering many locals who feel too much land is being sold off, too cheaply.
At the end of 2010, Chinese citizens and businesses owned about 49,000 square metres of land on the resort island. By June this year, their holdings rose to 2.46 million sqmetres, Jeju provincial government data showed.
In other words, the amount of Jeju properties owned by Chinese investors has increased 4,892 per cent in just 2½ years.
"About 85 per cent of Chinese-owned land is meant for large resorts and hotel developments," said Ko Tae-min, a provincial government official responsible for attracting foreign investment to Jeju.
The remaining 15 per cent was for timeshares at condominium resorts and for small businesses, he told the South China Morning Post.
By June this year, Chinese-owned land in Jeju was worth nearly 158 billion won (HK$1.1 billion).
The jump in property investments coincides with Korea's introduction of permanent resident visas to foreigners who invest in property in Jeju.
Since 2010, foreign investors who invested 500 million won or more into real estate on the island have been eligible to apply for permanent residency.
Investing in Jeju as a pathway for Korean permanent residency appealed to Chinese citizens because of the island's proximity to China, its mild climate and good health care facilities, Korean media reported.
Most Chinese property buyers and developers in Jeju were believed to be from Shenyang, Beijing, Shanghai and Nanjing, a local media report said.
The Jeju provincial government and the Ministry of Justice launched the investment programme to raise funds and internationalise the island, but many local residents remain sceptical of the trend that they call "China money".
"We are selling precious Jeju land too cheaply," said Park Gyeong-hoon, the chairman of the Jeju People's Artist Federation. "If we keep selling land like this, we'll run out of it and local people will be kicked out of their land."
Despite concern at what many Jeju residents see as growing Chinese domination of the island, Americans still own more land than the Chinese.
By June this year, US citizens collectively owned the largest amount of land in Jeju with 3.7 million sqmetres, while the Japanese owned 2.2 million sqmetres.
At present, Chinese-owned land accounts for 0.13 per cent of Jeju's total land mass.
Chinese investors' land-buying spree in Jeju would probably continue, especially in resort developments, because of sustained interest in the local tourism industry, the economy ministry said.