SEOUL —- South Korea recently tightened mortgage rules for Seoul, unveiling plans to tackle a housing shortage in the capital by adding more affordable homes than previously planned as it leverages land owned by state developers.
The loan-to-value (LTV) ratio for wealthy parts of Seoul, including the areas of Gangnam and Yongsan will be tightened to 40 percent of the property’s value from Monday, against 50 percent now.
South Korea has complex borrowing rules for households, especially on mortgage loans, which are linked to income as well as the value and locations of homes.
“As concerns about an upswing in home prices remain latent in the metropolitan area, we need extraordinary measures to stimulate supply while also controlling demand,” the government said in a statement.
