Anchor: Starting Saturday, mortgage loans for properties in Seoul and the surrounding area will be capped at 600 million won, or some 440-thousand U.S. dollars. By setting a strict ceiling on the amount, regardless of the borrower’s income or the value of the property, the government is seeking to curb the rapid rise in housing prices in Seoul.
Kim Bum-soo has more. 
 
Report: Apartment prices in Seoul have been on the rise for 21 consecutive weeks, leading to panic buying triggered by the fear of missing out. 

According to the Korea Real Estate Board, this week apartment prices in the capital city rose zero-point-43 percent from a week earlier — the highest jump in six years and nine months.

In a bid to contain the situation, the government introduced unprecedented loan regulations Friday.

Effective Saturday, the government is capping mortgage loans for individual homebuyers in Seoul and the surrounding area at 600 million won.

The limit applies regardless of property values or income levels. 

The government is also taking action to deter speculative real estate investments, requiring homebuyers to actually move into their financed properties within six months after the sale closes. 

Owners of multiple homes will not be eligible for loans to finance the purchase of residential properties in the Seoul metro area, while a buyer who already owns a single home must sell the existing property within six months of buying the new one.  

The government is also toughening the loan-to-value ratio to reduce the amount of money borrowed against the value of an asset.

In introducing the measures, the government instructed the nation’s lending institutions to reduce their aggregate household loans to 50 percent of their current targets.

The Financial Services Commission’s secretary general warned against providing leverage beyond the borrower’s ability to repay, blaming the practice for the nation’s overheated housing market.

The government says it is open to taking additional measures if necessary. 

Apartments in downtown Seoul go for an average of 22-thousand-875 dollars per square meter, according to a Deutsche Bank survey titled Mapping the World’s Prices 2025. 

That’s the fourth-highest figure among major cities around the world, exceeded only by Hong Kong, Zurich and Singapore.
Kim Bum-soo, KBS World Radio News.