Housing Subscription Savings Interest Rate Raised from 2.1% to 2.8%

Significant Enhancement of Benefits for Holding Housing Subscription Savings

The government will raise the interest rate on subscription savings from 2.1% to 2.8%. This measure reflects concerns that the subscription savings interest rate is lower than market rates, resulting in insufficient effectiveness.

The Ministry of Land, Infrastructure and Transport announced on the 17th that it will significantly enhance benefits related to subscription savings as a follow-up measure to the 'Second Half Economic Policy Direction.'

First, the subscription savings interest rate will be increased by 0.7 percentage points from the current 2.1% to 2.8%. This is an additional 0.7 percentage point increase following a 0.3 percentage point hike last November.

As a result, approximately 26 million people are expected to benefit from the interest rate increase.

Along with the increase in subscription savings interest rates, purchase and jeonse loan interest rates will also be raised by 0.3 percentage points. The Didimdol loan rates will increase from 2.15?3.0% to 2.45?3.3%, and the Beotimmok loan rates will rise from 1.8?2.4% to 2.1?2.7%, respectively.

However, interest rates for government policy loans aimed at low-income households, such as New:Home mortgages and loans for victims of jeonse fraud, as well as interest-free loans for irregular housing, will be frozen.

Additionally, financial and tax benefits, as well as subscription benefits for subscription account holders, will be strengthened. Interest rate discounts on purchase loans for account holders will be expanded (maximum from 0.2 to 0.5 percentage points), and the annual payment limit eligible for income deduction will be raised from the existing 2.4 million KRW to 3 million KRW (40% deduction).

Subscription benefits related to account holding will also be enhanced, including spouse account holding period aggregation (up to 3 points), selection of winners by long-term subscription order in case of tied scores, and extension of recognized payment period for minors from 2 years to 5 years.

The Ministry of Land, Infrastructure and Transport plans to implement the adjustments to subscription savings and loan interest rates, as well as the enhancement of financial benefits, within this month. Furthermore, amendments to laws related to tax and subscription benefits will be completed through procedures by the second half of this year.

Jin Hyun-hwan, Director of the Housing and Land Office at the Ministry of Land, Infrastructure and Transport, stated, "We expect that this institutional improvement will more reliably support the foundation for citizens to own their homes."

This content was produced with the assistance of AI translation services.