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South Korea financial regulator sees bubble in housing prices

[SEOUL] South Korea's top financial regulator said on Tuesday that a property market bubble in the country could potentially burst, issuing a stark warning unlike other policymakers, who have avoided describing the frothy market as a full-blown bubble.

"It's surely a bubble," Financial Services Commission (FSC) Chairman Eun Sung Soo said during a year-end lunch meeting with reporters. "I am not saying prices will surely collapse, but I, as the FSC chairman, need to be prepared."

Senior government officials have said housing prices in part of the country were rising too fast but have not said there was a price bubble in the country's housing market as a whole, because steep price declines are also dangerous.

The comment came a day after the government announced new property market regulations, including tighter mortgage rules and higher tax rates, although the measures were targeting high-priced homes in select districts.

REUTERS