Household Loans Rise in June: Real Estate and Stock Markets Heat Up in South Korea
South Korea's household loans have surged in June, driven by strong demand in the real estate and stock markets. The five major commercial banks have reported a significant increase in new household loans, with a particular focus on unsecured loans and home-backed loans.
Household LoansReal EstateStock MarketSouth KoreaFinancial MarketsReal EstateJun 15, 2025
Household loans extended by these banks gained nearly 2 trillion won (US$1.46 billion) since the start of this month, reaching 750.08 trillion won as of Thursday, according to the data. The banks have reported a continued increase in new household loans, with a 1.8 trillion won on-month gain in March, 4.5 trillion won in April, and 4.99 trillion won last month, as reported by Yonhap news agency.
Unsecured loans reached 103.9 trillion won, increasing by 600 billion won over the same period to reach the highest level since November. Market watchers attribute this rise to strong demand for investment in the real estate and financial markets. The five major banks extended more than 3 trillion won in fresh home-backed loans for house purchases in the first 12 days of this month, with home prices in Seoul jumping at the fastest clip in nearly a year.
Last week, Seoul’s apartment sale prices rose by 0.25 percent from the previous week, marking the highest weekly increase since August last year, according to data from the Korea Real Estate Board. Amid the signs of a heat-up in the housing market, the Financial Services Commission and the Financial Supervisory Service plan to hold a meeting with officials from financial institutions, including major banks, on Monday to call for measures to rein in the recent spikes in household loans.
Meanwhile, a big portion of the unsecured loans is assumed to be used for stock and cryptocurrency purchases. Investors’ deposits at securities firms have reached 62.9 trillion won as of Thursday, the highest in more than three years, according to data compiled by the Korea Financial Investment Association. The benchmark Korea Composite Stock Price Index (KOSPI) had risen for seven consecutive sessions until Thursday, surpassing the 2,900-point mark for the first time since January 14, 2022.
Frequently Asked Questions
What is the main reason for the rise in household loans in South Korea?
The main reason for the rise in household loans in South Korea is the strong demand for investment in the real estate and financial markets, particularly in the stock and cryptocurrency sectors.
How much have household loans increased since the start of June?
Household loans extended by the five major commercial banks in South Korea have gained nearly 2 trillion won (US$1.46 billion) since the start of June.
What measures are being taken to control the rise in household loans?
The Financial Services Commission and the Financial Supervisory Service plan to hold a meeting with officials from financial institutions, including major banks, to discuss and implement measures to rein in the recent spikes in household loans.
How have home prices in Seoul been affected?
Home prices in Seoul have seen a significant increase, with apartment sale prices rising by 0.25 percent from the previous week, marking the highest weekly increase since August last year.
What is the current status of the South Korean stock market?
The benchmark Korea Composite Stock Price Index (KOSPI) has been on a rising trend, surpassing the 2,900-point mark for the first time since January 14, 2022, and has risen for seven consecutive sessions.
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