(Bloomberg) -- South Korea plans to increase guarantees for short-term property loans as part of its efforts to address potential shortages in housing markets strained by higher interest rates and building costs. 

Korea Housing & Urban Guarantee Corp. and Korea Housing-Finance Corp. will step up their support for the so-called project-finance loans to 25 trillion won from 15 trillion won, the government said in a joint statement on Tuesday. The ceiling on loans will also rise to 70% of total project costs from 50%.

The announcement addresses public concerns about a looming home shortage after developers became hesitated to start projects due to concerns about rising costs. Groundbreaking decreased 56% in the first eight months this year from the same period of last year while building permits slumped 39%, the ministry said.

The move suggests authorities are more confident in containing the risk of defaults on project-finance debt, a type of security at the heart of Korea’s credit crisis last year. 

South Korea also aims to issue approval for 470,000 homes by year-end and supply more than 1 million homes by 2024, it said. The government under Yoon Suk Yeol who took office last year, seeks to have 2.7 million homes supplied by the end of his five-year term.

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