◆The 10·15 Measures are a set of loan regulation policies announced by the Lee Jae-myung administration, following the 6·27 Measures, aimed at curbing overheating in South Korea's real estate market.


The government introduced additional tightening of mortgage lending rules after sharp increases in home prices and sustained demand for new home purchase loans, particularly in Seoul and parts of Gyeonggi Province.


Under the 10·15 Measures, the government applied differentiated limits on mortgage loans for home purchases in the Seoul metropolitan area and regulated zones, based on the market value of the property. The loan cap remains at 600 million won ($450,000) for homes valued at up to 1.5 billion won ($1.13 million), but is reduced to 400 million won ($300,000) for homes priced between 1.5 billion and 2.5 billion won ($1.13 million–$1.88 million), and to 200 million won ($150,000) for homes exceeding 2.5 billion won ($1.88 million).


The scope of the Total Debt Service Ratio (DSR) regulation was also expanded. Since the 29th of last month, single-home owners in the Seoul metropolitan area or regulated zones who take out jeonse loans (a lump-sum rental deposit unique to Korea) as tenants will have the interest payments from those loans reflected in their DSR calculations.


Additionally, the minimum stress rate added to individual borrowers' mortgage rates was raised to 3%—from the previous 1.5%—for mortgages in the Seoul metropolitan area and regulated zones. The implementation of a higher risk weight (from 15% to 20%) for mortgage loans at banks was also brought forward from April to January next year.


Furthermore, 12 areas—including all of Seoul, Gwacheon, Gwangmyeong, Bundang, Sujeong, and Jungwon districts in Seongnam, Yeongtong, Jangan, and Paldal districts in Suwon, Dongan district in Anyang, Suji district in Yongin, Uiwang, and Hanam—were newly designated as regulated areas, speculative zones, and land transaction permit zones. As a result, the loan-to-value (LTV) ratio for mortgages in these areas was lowered from 70% to 40%. The purchase of homes in regulated areas by borrowers with existing jeonse or unsecured loans was also restricted. For non-residential properties such as commercial buildings and officetels in newly designated land transaction permit zones, the LTV was similarly reduced from 70% to 40%.


(Seoul=Yonhap Infomax) Dong Kyu Heo

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