Although the government's normalization of lending regulations is just a week away, commercial banks are predicting that lending will not increase significantly.

From the 1st of the following month, the LTV for non-homeowners in regulated areas will be applied collectively at 50%, and apartment mortgage loans exceeding KRW 1.5 billion will be allowed in speculation and overheated districts.

The ceiling on home loans for ordinary people and actual consumers will also be raised from KRW 400 million to KRW 600 million.

The government's plan is to induce a soft landing in the real estate market while easing loan regulations.

However, front-line banks believe that demand for loans will not increase as the real estate market itself is on a downward trend and interest rates are high.

As of the 18th, the variable interest rates on mortgage loans (linked to Cofix) of the four major commercial banks (KB Kookmin, Shinhan, Hana, and Woori) are 5.280 to 7.805% per year.

Credit loan interest rates (grade 1, 1 year, 6.218-7.770% per year) are also close to the 8% range, and mixed-type (fixed) interest rates on housing mortgage loans (5.200-7.117% per year) and jeonse loans (Housing Finance Corporation Guarantee, The two-year maturity) interest rate (5.230-7.570%) also far exceeded the highest 7%.

In addition, the fact that the DSR regulation is still in place is expected to act as an obstacle to the expansion of the Judamdae.

DSR is an indicator that indicates the ratio of principal and interest to be repaid to income. Under the current DSR regulation (step 3), which has been applied since last July, if the total loan amount exceeds 100 million won, in principle, the annual principal and interest repayment amount is 40% of annual income (secondary financial sector 50%) should not be exceeded.

The government plans to ease LTV regulations from next month, but maintain DSR regulations for the time being, so other lending regulations are expected to have limited effects.

Commercial bank officials predicted that the real estate market would recover, interest rates would stabilize, and demand for trading and charter rental would revive only in the second half of next year.

(Photo = Yonhap News)