Seoul homebuyers fault South Korea loans as 600 million won cap trails prices

South Korea has expanded housing-finance support for newlyweds, first-time buyers and young renters while also loosening loan-to-value, or LTV, rules for newly built non-apartment housing from the 31st, but the measures are facing criticism that they do not align with Seoul prices or demand. The government removed the so-called marriage penalty in some policy mortgages by allowing eligibility based on either spouse's income, and the Financial Services Commission said youth-focused products, including the Youth Future Bogeumjari Loan from January, will target borrowers aged 39 or under. Separately, authorities will allow up to 30% LTV in regulated zones and up to 60% in non-regulated zones for certain newly built villas and other non-apartment homes, with 60% available regardless of location for registered rental business operators and some demolition-linked purchases. Critics say the 600 million won cap on key policy mortgages remains far below Seoul apartment prices, the youth mortgage is restricted to non-apartment homes priced at 400 million won or less, and the age-39 cutoff excludes older non-homeowners. Analysts also question how much the LTV easing can lift supply because eligible newly built non-apartment stock is scarce after jeonse fraud, a project-financing crunch and rising construction costs, even as Seoul's rental market continues shifting from jeonse toward monthly rent.

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