Jeonse prices still rising, albeit more slowly

Prices of jeonse, or two-year housing contracts, kept on rising for the 60th consecutive week, according to data released by the Korea Appraisal Board yesterday.

As of Monday, the nation’s jeonse price index rose 0.29 percent from a week earlier. The index for Seoul jumped 0.41 percent.

The board tracks rents and sale prices of houses every week.

Sale prices of apartments across the nation inched up 0.14 percent, rising for the seventh week in a row. In Seoul, sale prices climbed 0.16 percent.

The Ministry of Land, Infrastructure and Transport said jeonse prices are rising at a slower pace than in previous years.

According to a ministry report yesterday, jeonse prices of apartments and houses across the nation rose 3 percent from January through September compared with the same period last year. The growth rate is 1.5 percent slower than the average pace of the past five years, the ministry said.

“While the market is overly focused on how long jeonse prices have been going up, it is important to note that the actual growth rates are lower than before,” said Do Tae-ho, deputy minister for the ministry’s department of land and housing policy. “Growth will slow further in November, stabilizing the property market.”

Despite the government’s positive forecast, consumers struggle to find affordable houses on jeonse contracts.

“Even after the government announced the policy to ease the jeonse crisis, there are many people having difficulty in getting jeonse houses,” said a realtor in southern Seoul. “My customers say they feel like jeonse prices are skyrocketing every week, about triple from last year.”

“It is difficult to say the jeonse crisis will be alleviated even with growth rates lower, since prices are at their highest levels already,” said a researcher at the Hyundai Research Institute.

BY SONG SU-HYUN [ssh@joongang.co.kr]