A wide range of proposals on housing finance reform emerged at the national real estate policy forum chaired by President Lee Jae Myung at the KBS annex in Yeouido, Seoul, on Thursday. Key issues included the management of aggregate loan limits, support for first-time buyers such as young people, and the regulation of relocation loans and jeonse loans.
Ahn Dong-seong, a licensed real estate agent from Jeju Island, said homes worth living in on Jeju Island start at 400 million to 500 million won ($338,000), while the average wage earner takes home about 2.71 million won a month — roughly 33 million won a year — making it structurally impossible for salaried workers to buy a home.
He said, "The debt service ratio is capped at 40 percent and the stress DSR applies on top of that — shouldn't regional areas and adjustment-target zones be treated separately? Please at least exempt regional areas from the DSR." He then said, "Please also lift the DSR and stress DSR requirements on landlords' deposit-refund loans. If a landlord is constrained by the DSR and cannot return the deposit, the property goes to auction — and that causes serious harm to tenants as well."
Lee expressed agreement, saying policies need to be fine-tuned to suit specific circumstances so that efficiency can be maximized.
Shin Seung-ju, an assistant manager at the National Credit Union Federation of Korea who introduced himself as a newlywed in his second year of marriage, said fixed loan ceilings of 600 million, 400 million and 200 million won leave newlyweds with no options. "I want to buy a home by leveraging my abilities and future potential. It would be great if these restrictions were eased and there were support measures that take newlyweds and young people into consideration," he said. He also suggested that financial cooperatives be considered as a channel for housing finance support.
![Participants raise their hands to request the floor at the national real estate policy forum chaired by President Lee Jae Myung at the KBS annex in Yeouido, Seoul, on Thursday. [Yonhap]](https://wimg.heraldcorp.com/news/cms/2026/07/23/rcv.YNA.20260723.PYH2026072309610001300_P1.jpg)
Lee Gwang-su, who runs the YouTube real estate channel "Gwangsu's Bokdeokbang," argued that existing loans need to be restructured. He said current loan regulations apply only to new borrowers, and that loan-to-value ratio, debt-to-income ratio (DTI) and debt service ratio (DSR) rules should be applied equally to existing borrowers.
"Why are only people without homes or young people being regulated?" he said. "People who took out loans and bought homes earlier have seen their property values rise sharply, yet there are no restrictions on them."
President Lee called the proposal "a new way of thinking." He said the idea of requiring existing borrowers to repay in full at maturity and refinance under current conditions was something he had previously raised and that is already being implemented. He added that he was unsure whether it was being applied broadly and comprehensively, and asked officials to look into it.
Lee also directed the Financial Services Commission to review a citizen's request that group loans be excluded from aggregate loan management targets.
Hwang Jeong-min, who said she is set to move into an apartment in Suwon this year, said she has been unable to secure a closing loan because banks have exhausted their household lending quotas. "I understand the intent of the policy to curb speculative demand, but for genuine buyers who signed contracts two years ago, the closing loan restrictions should either have an exemption or a transitional measure applied," she said.
Lee said the concern was valid. "This is a situation where something was already finalized and then the policy changed afterward — that's a legitimate point," he said. "This is a problem. We need to minimize the number of people who get hurt at that boundary."
FSC Chairman Lee Eok-won acknowledged that because aggregate household lending is being regulated, individual banks have been tightening their own limits beyond what is required, cutting off loans that could otherwise have been extended. "We will consult with the banks on that," he said.
![President Lee Jae Myung and Prime Minister Han Seong-sook listen to participants at the national real estate policy forum held at the KBS annex in Yeouido, Seoul, on Thursday. [Yonhap]](https://wimg.heraldcorp.com/news/cms/2026/07/23/rcv.YNA.20260723.PYH2026072308700001300_P1.jpg)
Park Jin-ju, a resident of Nowon-gu in Seoul, urged the government to address relocation loans tied to reconstruction projects. "The appraised value of reconstruction apartments is not high, so with the LTV capped at 40 percent, you can only borrow 100 million to 200 million won. Finding a jeonse apartment in Seoul with that amount is nearly impossible," she said.
In response, President Lee asked whether the issue was related to the choice of using the existing home or the new unit as collateral, and whether a shift to using the new unit as collateral was under consideration. FSC Chairman Lee said he would look into what practical measures could ease the difficulties surrounding relocation loans.
Online comments calling for looser lending rules were also read out several times during the forum. One viewer watching the live YouTube stream said, "Please expand the LTV for first-time homebuyers and raise the loan ceiling. Newlyweds who earn well but have no family wealth are struggling enormously under the current conditions."
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