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Property sector output sinks in Oct. amid tighter rules

All News 09:13 December 04, 2017

SEOUL, Dec. 4 (Yonhap) -- Output in South Korea's real estate industry fell at the fastest clip in October due mainly to tighter government measures to rein in the overheating housing market, data showed Monday.

The seasonally adjusted production index of the real estate and property rental sectors dropped 15.2 percent in October from the previous month, according to the data from Statistics Korea.

It marks the steepest monthly decline since 2000 when the statistical agency began to compile related data.

The figure also shrank 5.7 percent in October from a year earlier, the biggest decrease since August 2012.

Property sector output sinks in Oct. amid tighter rules - 1

The plunge resulted from a tumble in the number of apartment sales or rentals in the wake of the tougher measures to rein in mortgages, the agency said, adding transactions of offices, shops and plants went south as well.

"The government measures resulted in a decline in home transactions," an agency official said. "In addition, the 10-day Chuseok holiday in early October probably affected trading."

The government had been doubling down on cooling the housing market as part of efforts to rein in the country's snowballing household debt, which hovers above 1,400 trillion won (US$1.29 trillion).

In June, the government imposed tougher mortgage rules. Two months later, it designated Seoul and two cities -- Sejong and Gwacheon, south of Seoul -- as "speculative or overheated speculative districts," subjecting them to far tighter taxes, financial regulations and state scrutiny.

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