The real estate policy of the Korean government had until recently only focused on restraining speculative investment in the real estate market, which was the prevalent consensus in the country in the 1970's and the 1980's. These strict measures in the real estate market have been a serious obstacle to the government, in their active efforts to gain foreign capital in order to overcome the economic crisis since the International Monetary Fund $55 billion bailout to the Korean government. During the Asian crisis, both large institutional companies and small businesses went bankrupt due to financial distress caused by over-leverage. Consequently, the government has changed the paradigm of real estate policies on the basis of a free market principle, and has completely opened the real estate market to foreign investors in order to solve some of the current financial problems and to provide a momentum to redevelop the Korean economy. As part of the ongoing effort to stabilize the Korea economy, securitization in the real estate market is inevitable. In this thesis, the securitization efforts undertaken by the government will be examined to infer their future impacts on the real estate market of Korea. With the first issuance of asset backed-securities (ABS) by the Korea Asset Management Corporation (KAMCO), a resolution trust formed by the Korean government to liquidate non-performing loans, the outlook of the Korean economy is positive yet with a degree of uncertainty. In addition, the introduction of mortgage-backed securities (MBS) and real estate investment trusts (REITs) could have a profound effect on the Korean financial markets. Thesis Supervisor: Blake Eagle Title: Chairman, Center for Real Estate Acknowledgements This thesis would never have been completed without the support and assistance of many people. First we owe our most sincere appreciation to Mr. Blake Eagle, Chairman of the Center for Real Estate and our thesis advisor, for his continuous guidance and endless patience. Second, we want to thank Mr. Pietro Doran for his assistance in providing critical information for our thesis. Third, people at the Samsung Securities Research Center were extremely helpful to us with their research report and material, we are deeply indebted to them. Last, we want to thank our family and friends for their continuous mental support and encouragement during our thesis writing process.

Korea: Problems and Issues in a Rapidly Growing Economy

Citations

The Securitization of the Real Estate Market in Korea: Future Impacts to the Korean Real Estate Market

Building Political Consensus and Distributing Resources

References

The Securitization of the Real Estate Market in Korea: Future Impacts to the Korean Real Estate Market

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