The South Korea Financial Services Commission reviewed the 21 housing supply measures in its Aug. 13 real estate market package and reported that 12 were completed during August. These measures expanded project finance guarantees, improved guarantee terms for residential projects, adjusted loan-to-value calculations for relocation loans and strengthened financing support for housing businesses. They also included the launch of dedicated centers on Sept. 1 to address financing difficulties at project finance sites and construction companies. The commission will defer project finance capital ratio requirements for residential developments for two years and could publish implementation details as early as September after consulting the financial and construction sectors. The requirements will still take effect for nonresidential developments in 2027 as planned, while existing sector-specific prudential rules will remain in place. Work is also continuing to expand syndicated lending and financial sector investment funds. Securities firms plan to establish an additional KRW 2.1 trillion fund by year-end, supplementing existing sector funds of KRW 7.3 trillion. Remaining measures require legislation or budget approval. Subject to parliamentary approval of KRW 500 billion for 2027, Korea Asset Management Corporation plans to invite fund managers in October and complete their selection by year-end. The commission will hold weekly implementation meetings for the time being to monitor whether the financing measures translate into additional housing supply.

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