Calls grow to end weekly apartment price index

Disputes are growing over the weekly apartment price index compiled by the state-run Korea Real Estate Board under the Ministry of Land, Infrastructure and Transport. Critics say the index, intended to track housing trends and guide policy, instead unsettles the market, fuels volatility and risks policy mistakes.

Each week, the board surveys 35,000 representative apartments nationwide. If no sale takes place, surveyors estimate prices based on comparable transactions or asking prices. In periods of low activity, the numbers often rely on subjective judgment, raising doubts about accuracy. At Eunma Apartments in Seoul’s Gangnam District, for example, more than 20 weeks can pass without a single transaction, yet weekly price updates are still released.

Because of these shortcomings, South Korea is said to be the only country that publishes an official housing price index on a weekly basis. The United States and Japan release theirs monthly. Weekly indexes from private domestic firms face the same problem, as local agents enter prices of comparable units when no trades occur, undermining credibility.

Despite these flaws, the Real Estate Board’s data are used by the government to calculate levies such as the reconstruction excess profit charge. If the weekly statistics underestimate an apartment’s “starting price,” post-reconstruction gains appear larger than they actually are, leading to excessive charges. Critics say this has sparked disputes and hindered efforts to expand housing supply in Seoul and nearby areas.

The problem has worsened as transactions nearly freeze. A single high-priced sale can sharply swing the index, and questionable practices are rising, such as reporting inflated prices that are later canceled. If the government bases housing measures on such distorted data, tax and financial policies could become detached from reality. Observers say the weekly index should be abolished or suspended and replaced with a monthly report the public can trust.