South Korea Seeks to Boost Home Supply Amid Worries of Rising Prices
- Elevated inflation, rates and credit risks have crimped supply
- Rising home prices among reasons keeping BOK wary of rate cut
The Bank of Korea held its benchmark rate at a restrictive 3.5% last month and cautioned that its signal of an interest rate cut could further fuel a rally in real estate markets and add to household debt.
Photographer: Woohae Cho/BloombergSouth Korea announced a series of steps intended to increase housing supplies as it tries to temper a rebounding property market that has frustrated potential buyers and made the central bank cautious about a policy pivot.
The government of President Yoon Suk Yeol plans to ease restrictions on redevelopment projects, help speed up the construction of apartments and provide loan guarantees to developers, according to a Finance Ministry statement that contained a slew of measures. So far, the administration had largely refrained from policy intervention, seeing the rise as limited to certain middle-class neighborhoods.