Mortgage approvals by 6 retail banks hit 7-month high in June

Mortgage lending by six major retail banks grew to a seven-month high in June, as more people sought to receive mortgages before the government tightens lending regulations for home mortgages, data showed Monday.

The value of home loans at the six banks, including Shinhan, Kookmin and Woori, rose by 2.7 trillion won ($2.36 billion) to 383 trillion won at the end of June. 

It was the fastest monthly growth since November last year, when mortgage lending by the six banks grew by 3.1 trillion won.

Last month, a total of 14,442 apartments in Seoul were sold or purchased, marking the highest number of monthly transactions since December 2006.

With home prices in Seoul and other areas showing signs of overheating, the government has pushed to prevent liquidity from being used for real estate speculation.

Effective Monday, the lending ceiling for homes located in areas designated by the government was lowered from 70 percent to 60 percent of the property's value. The debt-to-income ratio will also be lowered to 50 percent from 60 percent.

The measures represented the government's latest efforts to tame the rise in real estate prices amid growing household debt, which topped 1,300 trillion won at the end of March. (Yonhap)