Seoul: The government has announced plans to significantly increase the housing supply in the metropolitan Seoul area as part of efforts to stabilize the housing market. Land Minister Kim Yun-duk detailed the initiative, stating that the government will build 270,000 new homes annually from 2026 to 2030, totaling 1.35 million new homes in the greater Seoul area.

According to Yonhap News Agency, the government is also set to implement stricter measures to curb property speculation in Seoul and its neighboring areas. Starting Monday, the loan-to-value (LTV) ratio for home-backed loans for non-homeowners in certain districts, including Gangnam, Seocho, Songpa, and Yongsan, will be reduced from 50 percent to 40 percent. These districts have been marked as anti-speculation areas by financial authorities.

The housing supply plan includes the construction of 23,000 units by reconstructing old public rental houses, 28,000 units by refurbishing old state-owned buildings, and 140,000 units through the purchase and renovation of studio apartments. The Korea Land and Housing Corp. (LH) will oversee the supply of these newly built homes.

In addition to these measures, the LTV ratio for rental business operators in anti-speculation areas will be cut to 0 percent from the existing 30 percent. Furthermore, the government will impose a 200 million-won (US$144,000) cap on "jeonse" loans for single-home owners in the greater Seoul and anti-speculation areas. This is a decrease from the previous allowance of up to 300 million won for jeonse loans for those owning a single house.

The new announcement comes after a series of policy measures were introduced in late June to tackle rising home prices. These measures included a 600 million-won ceiling on home-backed loans for home purchases in the capital area.