The government has drastically lowered the ceiling on mortgage loans for individual homebuyers in Seoul and the surrounding areas to 600 million won, or around 440-thousand U.S. dollars. 
 
The Financial Services Commission(FSC) on Friday announced tighter loan regulations in a bid to curb rising apartment prices in the Seoul area, which have seen the highest jump in almost seven years this week. 

While the 600 million won cap on home mortgages in the capital area becomes effective Saturday, the government is also requiring homebuyers to move into their financed properties within six months after closing. 

Lenders are now prohibited from granting housing-backed loans to owners of multiple homes and have been instructed to reduce their aggregate household loans to 50 percent of their current targets.

In introducing the unprecedented measure, the FSC’s secretary general warned against supplying leverage beyond a borrower’s ability to repay, blaming the practice for the nation’s overheated housing market.