Metro Apartment Sales to Be Disclosed

The cost of real estate sales of private apartments in all metropolitan areas will be disclosed starting September. Apartment-backed borrowing in speculative regions will be limited as well.

The government and the Uri Party announced on January 11 the “January 11th Real Estate Measures” based on the above after a government-ruling party consultation.

The consultation was attended by Kim Geun-tae, chairman of the Uri Party, Kang Bong-kyun, chairman of the Uri Party Policy Committee, Prime Minister Han Myeong-sook, Deputy Prime Minister and Finance-Economy Minister Kwon O-kyu, Lee Yong-sup, Minister of Construction and Transportation and others.

Deputy Prime Minister Kwon said after the government-ruling party consultation, “If this measure is implemented along with the price cap in apartment houses agreed upon last year, the cost of public apartments would drop over 25 percent and that of private ones by about 20 percent.”

On the list of the private apartments whose cost will be disclosed are those to be built on the building site within highly speculative regions including Seoul, Incheon, the Gyeonggi region and other metropolitan areas. The revelation will take place after verification by the “Apartment Sales Cost Monitoring Committee” of local governments, including smaller precincts’.

A total of seven items will be disclosed, namely, the cost of the building site (the appraisal cost), standard construction cost (five sub-categories including designing cost) and additional cost (including underground parking lot cost).

The government and the ruling party discussed issues including a five-percent cap on the increase rate for full-deposit system fees as well as the full-deposit or monthly rental payment and the housing registration system. However they decided not to adopt changes in them this time.

Real estate experts expressed concerns that this measure would be conducive to stabilizing the real estate market by temporarily lowering the cost of sales, but side effects will come about such as a short of private apartment supplies taking up 70 percent of the total housing market.

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