SEOUL, Oct 2 (Reuters) - South Korea’s Moon Jae-in administration announced nine separate sets of measures to stabilize home prices in Seoul and other major cities since his cabinet’s inauguration in May 2017.
But he faces criticism for failing to calm housing market and worsening home affordability.
Below are the key policies:
Most of Seoul and some surrounding areas become subject to tighter mortgage rules. Loan-to-value ratios are tightened to 60 percent from 70 percent in 25 Seoul districts.
Multiple homeowners in the areas where property speculation is deemed to be rife face a 10 percentage point increase in capital gains taxes, effective April 2018. Those who own more than three homes face a 20 percentage point increase.
Loan limits for home buyers in Seoul and its outskirts tightened to 40 percent of a property’s value, down from 60 percent.
Debt repayments are limited to 40 percent of annual income in selected regions, down from 50 percent.
The government, making a pledge to bring annual growth in household debt below 8 percent, asks banks to strengthen screening process for personal loans.
The government announces plans to add 1 million public housing units through state-run development projects by 2022 for newly weds and young Koreans.
The government announces plans to cut capital gains taxes for homeowners who register themselves as renters to increase the market supply.
The government announces plans for cheap loans and credit guarantees to support 880,000 newly married couples to live in social housing.
The government designates more parts of Seoul as speculative zones subject to tightened mortgage rules
The government announces plans for tougher taxes on property ownership. An initial proposal of a 0.5-2.0 percent ownership tax for properties valued over 600 million won ($540,103) will be raised to 0.5-3.2 percent, upon parliamentary approval.
The government announced plans to relax restrictions on the floor area ratio in Seoul’s business districts to build more homes, and vowed to develop land for building of 300,000 new homes. ($1 = 1,110.9000 won) (Editing by Marius Zaharia and Lincoln Feast.)