S. Korea considering housing price caps

Nov. 8, 2006 at 7:46 AM
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SEOUL, Nov. 8 (UPI) -- The South Korean government is considering measures to cool down the nation's hot housing market.

Among the measures being reviewed is a plan to limit prices of new apartment units built by private companies in non-government projects, JoongAng Daily said. Currently apartments government-built housing on public residential sites are subject to a price ceiling, as well as make public how much they spend on land, materials and administrative and other construction-related costs.

Analysts said if a cap is imposed, it may be difficult for the government to require to publicize associated building costs and could be seen as too much intervention in the housing market, JoongAng Daily said.

Some housing economists said the possible regulation would not be significant in stabilizing the housing market in the long run, JoongAng Daily said. Economists said new apartment units account for less than 3 percent of the total number of home units nationwide.

"Accordingly, it is absurd to stabilize the entire housing market by controlling the prices of new apartment units," Kim Kyung-hwan, economic professor at Sogang University, told the JoongAng Daily.

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