South Korea announced new plans on Monday to revive its property market which will include offering tax breaks to home buyers and cut borrowing costs.
First-time home-buyers with annual income less than 60 million won ($53,900) will be exempted this year from taxes on property purchases worth no more than 10 times their salary, the Ministry of Land, Infrastructure and Transport said in a joint statement with related ministries including the Finance Ministry.
Multiple-home owners will see rules relaxed on capital-gains taxes. The measures come just a month after President Park Geun-hye's inauguration, as she moves quickly to meet a campaign pledge to reduce household debt.
Ms. Park has promised to take action to revive the South Korean economy, the fourth largest in Asia. The steps include a supplementary budget bill of at least 12 trillion won, although not all of the additional money would be for additional spending.
Nationwide housing transactions, an indicator of future home prices, slid to 73,500 in 2012, the lowest since 2006 when the related data began to be compiled. The government did not say how much these measures would cost the public finances.
"The government did pretty much everything they can to deregulate and make it easy for home transactions to increase," said Jean Lim, an economist at Korea Institute of Finance, according to Bloomberg. "Sales will go up in the short-term."
