[SEOUL] South Korean President Moon Jae-in apologised over allegations of a land speculation scandal that has rattled his government and led the minister responsible for oversight to tender his resignation.

Mr Moon said at a cabinet meeting Tuesday that allegations of state-run Korea Land & Housing Corp employees abusing insider information to buy land led to "huge despondency and disappointment" for citizens, according to the presidential website.

The scandal is the latest in a series of questionable land deals that have dogged the Moon presidency. More than a dozen employees are being investigated for suspected purchases of farmland later selected by the central government as areas for major housing developments.

The scandal has sent Mr Moon's approval rating to near record lows, in a worrying sign for his progressive camp. Elections next month for the mayor's job in the country's two most-populous cities, Seoul and Busan, represent the Democratic Party's largest electoral test ahead of a presidential vote about a year away.

Land Minister Byeon Chang-heum offered to resign last week after about three months on the job. Mr Moon has yet to accept the resignation, looking to keep Mr Byeon in his post to push through some pending legislation. Mr Byeon was expected to step down before the mayoral elections in April, the Yonhap News Agency reported without attribution.

Mr Moon started the year pledging to take "extraordinary" measures to increase housing and rein in soaring home prices, which have been one of the biggest drags on his public approval. His administration has introduced a raft of property market regulations, but has failed to curb soaring prices in parts of the country, especially in large cities. Home prices in Seoul have jumped about 30 per cent since Mr Moon took office in May 2017.

A NEWSLETTER FOR YOU

Tuesday, 12 pm

Property Insights

Get an exclusive analysis of real estate and property news in Singapore and beyond.

Sign Up

Mr Moon, whose single five-year term as president ends in 2022, was dealt a blow earlier this month when the country's top prosecutor resigned in protest against the president's policy to strip the office of investigative powers.

Yoon Seok-youl, the former prosecutor general, has seen his support rise since then and was the top pick for president in a survey released last week, ahead of contenders in Mr Moon's progressive camp.

BLOOMBERG