The rental prices for apartments in the nation and Seoul have turned stable. It seems that the widespread loan restrictions are also affecting the rental market. Recently, banks have lowered loan hurdles mainly for actual users, but it is because loans for existing homeowners for rental funds have not been released until now. Even though banks are lowering the loan hurdles, the impact of not lowering the additional charge is significant.
According to the Korea Real Estate Board on the 22nd, the rental price for Seoul apartments in the third week of December (as of the 16th) recorded stability (0.00%). This marks a return to stability after 83 weeks since the fourth week of May last year. The national rental price (0.00%) also saw its upward trend halted for the first time in 46 weeks since the first week of February.
Recently, banks have started to open the doors for rental loans as they begin accepting applications for next year's loans, but the rental market is expected to maintain stability for the time being. This is due to the influence of the banks having raised the hurdles for rental fund loans and only lowering them for actual users. The additional charge for rental fund loans has also not been reduced.
Hana Bank resumed selling rental loans for loans to be executed next year starting from the 12th, while Shinhan Bank has also restarted rental fund loans for homeowners. NH Nonghyup Bank has decided to handle conditional rental fund loans starting from next year's executions, and Woori Bank has also resumed sales of non-face-to-face rental loan real estate financial products.
The rental loan products being resumed by major commercial banks are primarily geared towards actual users. In fact, banks have stated they will not handle loans that can be deemed speculative, such as mortgage loans for existing homeowners, until next year. Moreover, as banks have suspended rental fund loans for homeowners, actual users have continued to face a loan freeze for several months, leading to a decline in rental demand.
There is also a prevailing opinion that the rental market has turned cautious as the interest rates for rental fund loans at commercial banks have not decreased. As of the 20th, the interest rates for rental fund loans at the four major banks (KB, Shinhan, Hana, Woori) ranged between 4.03% and 5.18%. This marks a steady increase since an average of 3% recorded in July.
This is because banks are still not lowering the additional charge. The fixed interest rates for rental loans from commercial banks follow the two-year financial bond rates, while the variable rates follow the six-month financial bond rates. The two-year financial bond rates fell from around 3.2% to 2.9% in July, and the six-month financial bond rates also slightly fell from around 3.4% to 3.3%.
Even though banks have begun receiving applications for next year's rental loans and lowered the thresholds, the additional charge remains unchanged, suggesting that the burden on financial consumers is unlikely to decrease. The market is also expected to maintain a cautious stance, reflecting this situation.
Park Hapsu, a professor at the Konkuk University Graduate School of Real Estate, noted, "If the rental conversion rate remains at 4-5% while the loan interest rate stays at 5%, there will be no need to take a rental loan, increasing the demand for monthly rent or semi-rent. If rental loan interest rates decrease, mobility may become relatively easier, but given that borrowing costs are decreasing while banks are not lowering the additional charge, the burden on consumers is significant."