Another Government Presenting Only Favorable Statistics

Seoul Apartment Jeonse Price Increase Rate Presented Only by Korea Appraisal Board's First Week Data
Deputy Prime Minister Hong Diagnoses 'Slowing Increase'
Different Trend from Private Statistics

Hong Nam-ki, Deputy Prime Minister and Minister of Economy and Finance, is delivering opening remarks at the '8th Real Estate Market Inspection Meeting of Related Ministers' held on the 14th at the Government Seoul Office in Jongno-gu, Seoul. Photo by Kang Jin-hyung aymsdream@

[Sejong=Asia Economy Reporter Joo Sang-don] Deputy Prime Minister and Minister of Economy and Finance Hong Nam-ki's statement on the 14th that "the rate of increase in Jeonse prices is gradually slowing down" has drawn criticism that "the government is once again presenting statistics that only suit its taste." Deputy Prime Minister Hong based his diagnosis of the 'slowing increase in Jeonse prices' on the Jeonse Price Index from the Korea Appraisal Board, a government-approved statistic, but the Jeonse price increase rates from private statistics such as KB Kookmin Bank and Real Estate 114 actually increased more in October than in August.

The basis Deputy Prime Minister Hong presented for the slowing increase in Jeonse prices was the weekly Jeonse Price Index from the Korea Appraisal Board. According to this, the Seoul apartment Jeonse price increase rates were 0.17% in the first week of August, 0.09% in the first week of September, and 0.08% in the first week of October. Looking at this alone, the increase rate clearly decreased. However, the weekly increase rates after September have fluctuated between 0.08% and 0.09%. Judging only by recent increase rates, it is difficult to conclude that the upward trend has slowed. The Korea Appraisal Board analyzed the decrease from 0.09% to 0.08% in the first week of October as due to "a decrease in transaction activity caused by the Chuseok holiday." This means that the slowing increase is due to a special situation of the holiday, and this effect is inevitably temporary.

Moreover, the Korea Appraisal Board's Jeonse price statistics differ significantly from private statistics. First, Real Estate 114's Seoul apartment Jeonse price change rates were 0.07% in the first week of August, 0.12% in the first week of September, and 0.11% in the first week of October. Although the increase rate slowed down in October compared to the previous month, it is still steeper than in the first week of August. Especially, looking only at the period after mid-September, the increase rates of 0.10% in the third and fourth weeks of September rose to 0.11% in October.

KB Kookmin Bank's real estate statistics show a similar trend to Real Estate 114. The Seoul apartment Jeonse price increase rates were 0.21% in the first week of August, 0.45% in the first week of September, and 0.44% in the first week of October. The October Jeonse price increase rate is still about twice as steep as in August. Both Real Estate 114 and KB Real Estate statistics show a larger increase in Jeonse prices in October compared to August.

This kind of cherry-picking of statistics by the government is not the first time. In September this year, Deputy Prime Minister Hong cited specific cases of sharp price drops in certain apartments in Seocho and Songpa districts of Seoul, saying, "One month after the August 4 supply plan, results are appearing." However, the cases he cited differed in type, options, and floor levels.

A real estate industry official said, "If we concede a hundred times, it is not wrong to say that the increase rate in Jeonse prices has decreased by presenting the Korea Appraisal Board's statistics fragmentarily, but this is too far removed from the current market situation where people line up to see Jeonse houses and have to win rock-paper-scissors or succeed in drawing lots to sign a Jeonse contract," adding, "Such remarks create confusion in the market and can increase distrust in the government's real estate policies."

This content was produced with the assistance of AI translation services.