Seoul: The government is set to unveil measures next week aimed at easing the impact of terminating an exemption from capital gains tax for individuals owning multiple homes, as announced by Finance Minister Koo Yun-cheol. The move comes as part of an effort to stabilize housing prices and curb real estate speculation.

According to Yonhap News Agency, the exemption is scheduled to end on May 9, as reiterated by President Lee Jae Myung, who has emphasized the urgency of addressing soaring housing costs that are discouraging young people from pursuing marriage and starting families. Koo expressed the government's commitment to minimizing public inconvenience, particularly for those owning rental properties, through supplementary measures.

Koo's statement, made in a post on X, formerly known as Twitter, is seen as an attempt to tackle the challenges of selling occupied homes and to enhance renter protections. South Korea's rental market heavily relies on the jeonse system, where tenants pay a significant lump-sum deposit refundable at lease conclusion, typically after two years.

The government is contemplating grace periods for certain areas, including up to three months for properties in Seoul's Gangnam district and Yongsan, and up to six months for newly designated speculative zones. These grace periods would apply to transactions finalized or ownership registrations completed within the specified durations.

Currently, capital gains tax rates on real estate sales in South Korea range from 6 to 45 percent. In designated speculative areas, owners of two homes face an additional 20 percentage points, while those with three homes incur a 30 percentage-point surcharge on top of the basic rate.