Mortgage loan balances at South Korea’s five largest commercial banks rose by more than 5 billion won in about two weeks, as borrowers rushed to extend loans ahead of tighter rules and as spring moving demand picked up.
According to the financial sector on the 21st, mortgage balances at KB Kookmin, Shinhan, Hana, Woori and NH NongHyup stood at 610.8792 trillion won as of April 16. That was up 5.453 billion won from the end of last month and the highest level this year.
The five banks’ mortgage balances were 611.6081 trillion won at the end of December, then fell sharply to 610.1245 trillion won at the end of January. They then moved back and forth, reaching 610.7211 trillion won at the end of February and 610.3339 trillion won at the end of March.
With mortgages rising, total household lending at the five banks also increased. As of April 16, the balance was 766.4928 trillion won, up 7.637 billion won from the end of last month.
Analysts said the renewed increase in mortgages this month reflects heavy spring relocation demand and a rush tied to upcoming policy changes. With a ban on apartment-backed loans for multi-homeowners and the end of a temporary suspension of heavier capital gains taxes for multi-homeowners set for May 9, apartment prices have adjusted and buying interest has expanded again.
In Seoul, price gains have become more pronounced in outlying areas with many mid- to lower-priced complexes.
In the Korea Real Estate Board’s weekly apartment price survey for the second week of April (as of the 13th), Gangbuk-gu posted the biggest increase in Seoul, with the weekly rise widening to 0.27% from 0.16% a week earlier. Gangseo-gu (0.24%), Dongdaemun-gu (0.20%), Seongbuk-gu (0.20%), Seodaemun-gu (0.20%) and Guro-gu (0.17%) also continued to climb.
Transaction activity has also picked up. Data from the real estate big-data platform Asil and the Transport Ministry’s transaction disclosure system showed that, among the 50 most-traded Seoul apartment complexes from Feb. 1 to April 20, 46 — or 92% — were in outlying districts such as Nowon, Dobong and Eunpyeong; Geumcheon, Gwanak and Guro; Gangseo; and Jungnang. Nowon had the most, with 22 complexes, followed by Gwanak, Gangbuk, Seongbuk and Dobong.
A modest easing in mortgage rates this month also appears to have supported demand. The five banks said their average fixed mortgage rates stood at 4.14% to 6.74% as of the 21st, compared with 4.42% to 7.02% on March 31, with the upper end down 0.26 percentage points.
The change reflected a drop in the five-year AAA unsecured financial bond yield — a key benchmark for fixed mortgage rates — to 3.865% as of April 17 from 4.051% at the end of last month.
Last month, banks’ lending rates kept climbing, with the upper end topping 7%, as market rates jumped after international oil prices surged amid a U.S.-Iran clash. This month, rates have eased as expectations grew for an end to the war after U.S. President Donald Trump repeatedly mentioned the possibility of a ceasefire agreement with Iran.
A bank official said that with rates slightly lower than last month and the housing market entering a period of adjustment ahead of new regulations, demand appears to be rising for buyers seeking bargain listings. The official added that while trends may differ by bank, overall mortgage balances are likely to keep increasing for the time being.
According to the financial sector on the 21st, mortgage balances at KB Kookmin, Shinhan, Hana, Woori and NH NongHyup stood at 610.8792 trillion won as of April 16. That was up 5.453 billion won from the end of last month and the highest level this year.
The five banks’ mortgage balances were 611.6081 trillion won at the end of December, then fell sharply to 610.1245 trillion won at the end of January. They then moved back and forth, reaching 610.7211 trillion won at the end of February and 610.3339 trillion won at the end of March.
With mortgages rising, total household lending at the five banks also increased. As of April 16, the balance was 766.4928 trillion won, up 7.637 billion won from the end of last month.
Analysts said the renewed increase in mortgages this month reflects heavy spring relocation demand and a rush tied to upcoming policy changes. With a ban on apartment-backed loans for multi-homeowners and the end of a temporary suspension of heavier capital gains taxes for multi-homeowners set for May 9, apartment prices have adjusted and buying interest has expanded again.
In Seoul, price gains have become more pronounced in outlying areas with many mid- to lower-priced complexes.
In the Korea Real Estate Board’s weekly apartment price survey for the second week of April (as of the 13th), Gangbuk-gu posted the biggest increase in Seoul, with the weekly rise widening to 0.27% from 0.16% a week earlier. Gangseo-gu (0.24%), Dongdaemun-gu (0.20%), Seongbuk-gu (0.20%), Seodaemun-gu (0.20%) and Guro-gu (0.17%) also continued to climb.
Transaction activity has also picked up. Data from the real estate big-data platform Asil and the Transport Ministry’s transaction disclosure system showed that, among the 50 most-traded Seoul apartment complexes from Feb. 1 to April 20, 46 — or 92% — were in outlying districts such as Nowon, Dobong and Eunpyeong; Geumcheon, Gwanak and Guro; Gangseo; and Jungnang. Nowon had the most, with 22 complexes, followed by Gwanak, Gangbuk, Seongbuk and Dobong.
A modest easing in mortgage rates this month also appears to have supported demand. The five banks said their average fixed mortgage rates stood at 4.14% to 6.74% as of the 21st, compared with 4.42% to 7.02% on March 31, with the upper end down 0.26 percentage points.
The change reflected a drop in the five-year AAA unsecured financial bond yield — a key benchmark for fixed mortgage rates — to 3.865% as of April 17 from 4.051% at the end of last month.
Last month, banks’ lending rates kept climbing, with the upper end topping 7%, as market rates jumped after international oil prices surged amid a U.S.-Iran clash. This month, rates have eased as expectations grew for an end to the war after U.S. President Donald Trump repeatedly mentioned the possibility of a ceasefire agreement with Iran.
A bank official said that with rates slightly lower than last month and the housing market entering a period of adjustment ahead of new regulations, demand appears to be rising for buyers seeking bargain listings. The official added that while trends may differ by bank, overall mortgage balances are likely to keep increasing for the time being.
* This article has been translated by AI.
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