Govt. to introduce measures to tackle rising long-term rental prices
Amid Korea's ongoing slump in the property market, more and more homebuyers are turning to "jeonse," Korea's unique housing system of lump-sum rental deposits, instead of buying their own homes even if they can afford it.
The popularity of long-term housing leases have sent jeonse prices skyrocketing, and it's no news that an average Korean has to go through extreme difficulties in finding a decent place to live.
To ease the burden on its people, the government has stepped in.
According to the government's latest report on measures to stabilize the housing market, the National Housing Fund will be expanded while the interest rate on housing loans will be lowered, to encourage more people to buy homes.
Currently a married couple with a combined income of 40-thousand U.S. dollars looking to purchase a home that costs less than 270-thousand dollars receives government aid of up to 90-thousand dollars at an annual interest rate of four percent.
Now the government is reviewing ways to expand that support, so that married couples with higher incomes can afford to purchase more expensive homes at lower interest rates.
Market watchers are welcoming the government's possible new measures, saying that encouraging potential homebuyers with purchasing power to buy their own homes, is the quickest way at this point to revamp the sagging housing market.
The government also plans to increase this year's planned supply of jeonse and other housing from the current 36-thousand units to much more.
Details of the measures will likely be announced Wednesday.
Han Da-eun, Arirang News.
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