Korean mortgage rates have risen to their highest level in over two and a half years

On 28 July, according to the Korean Federation, data released on Tuesday by the Central Bank of Korea showed that, as a result of rising market interest rates, interest rates on bank home mortgages rose for the second consecutive month to their highest level in two years and seven months. The data show that the average interest rate on new loans from Korean banks was 4.31 per cent last month, an increase of 0.12 percentage points over the previous month. The average interest rate on enterprise loans rose by 0.14 percentage points to 4.27 per cent, while the interest rate on new family loans rose by 0.04 percentage points to 4.5 per cent. In June, the average interest rate on home mortgages rose by 0.04 percentage points to 4.36 per cent, the highest level since November 2023. The average interest rate on non-mortgage family loans was 5.72 per cent, an increase of 0.23 percentage points over the previous month. According to the Central Bank of Korea, interest rates on retail loans have continued to rise in recent months as market interest rates have risen. Earlier this month, the Central Bank of Korea had its first interest rate hike of three and a half years. Kim Xian