July 10, 2020 12:22
Apartment prices in Seoul continue to soar even after the government rolled out more curbs on real-estate speculation on June 17.
According to the Ministry of Land, Infrastructure and Transport on Thursday, an 85 sq.m residential unit at Dogok Rexle Apartment in Gangnam sold for W2.66 billion on July 3, up W165 million since the new regulations were announced (US$1=W1,195).
The sale was made one day after President Moon Jae-in told Land, Infrastructure and Transport Minister Kim Hyun-mee to come up with even tougher measures to tame apartment prices.
Instead, apartment prices all across Seoul are rising to record highs. Weekly prices tallied by the Korea Appraisal Board showed property values rising 0.11 percent over the week ending on July 6, the biggest rate of growth in seven months.
Experts say the curbs, which included drastically tightened housing loan requirements and designated almost the entire city a real-estate speculation zone, ended up causing the price skyrocket because more and more people fear that time is running out for them to buy.
Jung Su-yeon at Jeju National University said, "The government has lost credibility because its real-estate policies were based on political motives rather than market principles and have achieved the exact opposite of what the authorities wanted."
Meanwhile, Finance Minister Hong Nam-ki Friday announced yet another set of measures to stabilize the real estate market, which mostly focus on raising taxes for multi-home owners.
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