Seoul, July 27 (IANS) The average price of apartment units in Seoul changing hands has surpassed 1.4 billion won ($1.01 million) for the first time ever, data showed on Sunday.

According to the data compiled by KB Kookmin Bank, the average price of apartment units sold in Seoul since the beginning of this month came to 1.41 billion won, up 1.28 percent from a year earlier.

It followed the previous milestone of 1.3 billion won reached in April, marking a continued upward trend, reports Yonhap news agency.

The average price in Seoul’s 14 northern districts stood at 1.01 trillion won, while the 11 southern districts recorded an average of 1.76 billion won, the data showed.

The nationwide apartment price quintile ratio hit 12.0 in July, the highest since monthly tracking began in December 2008, underscoring a widening price gap between high-end and low-priced homes.

Seoul’s ratio also reached a record 6.5, marking the greatest price polarization on record.

The ratio compares the average price of the top 20 percent with the bottom 20 percent of apartments.

Seoul’s apartment price outlook index, however, fell to 98.0 in July from the previous month’s 133.9, the largest monthly drop since April 2013.

It also marks the first time that the figure has fallen below 100. A reading below 100 means more respondents expect prices to decline.

The decline in the index was, at least in part, attributed to the government’s tighter lending rules implemented in June, which capped mortgage loans in the capital region at 600 million won in a move to curb surging household debt and housing prices, officials said.

Meanwhile, a month after the introduction of tighter regulations on household loans, new applications for such loans have been more than halved, while the growth rate of outstanding loans at major banks has markedly slowed, data showed on Sunday.

During the first 18 business days of July, the average daily amount of household loan applications, including mortgage and credit loans, submitted to banks totalled 1.78 trillion won (US$1.29 billion), marking a 56.5 percent drop from the same number of business days in June, according to the data by the financial authorities.

On June 27, the government imposed a 600 million won cap on mortgage loans for property purchases in the capital region and suspended home-backed loans for multi-homeowners, effective the following day, in an effort to curb rising household debt and housing prices.

As of Thursday, the outstanding household loans at the top five banks — KB Kookmin, Shinhan, Hana, Woori and NH Nonghyup — stood at 758.92 trillion won, up 4.08 trillion won from end-June.

But the average daily increase came to 170.1 billion won in July, down 24 percent from the average of 225.1 billion won a month earlier.

—IANS

na/