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Relationship between False Price Reporting and Market Distortions in Real Estate

  • Korea Real Estate Review
  • 2023, 33(1), pp.39-56
  • DOI : 10.35136/krer.33.1.3
  • Publisher : korea real estate research institute
  • Research Area : Social Science > Law > Law of Special Parts > Law of Real Estate
  • Received : February 24, 2023
  • Accepted : March 24, 2023
  • Published : March 31, 2023

Lee, Sungwon 1 Chunil Kim 2 Kyu-hyun Ji 3

1강릉원주대학교
2강남대학교
3한양사이버대학교

Accredited

ABSTRACT

In Korea, the housing market is undergoing a period of rapid price increases, and a policy to prevent false price reporting is implemented as a stabilization strategy. However, research on the relationship between false price reporting and market distortions in the real estate industry remains lacking. This study aims to empirically estimate whether false reporting of real estate price cause market distortions. Specifically, the prices of canceled trade suspected of false reporting and of normal trade are compared by using the data of Real Estate Trade Management System (RTMS) apartment sales in Seoul, Korea from Feb. 2020 to Dec. 2021. Double-adjustment in Propensity Score Matching is combined with Coarsened Exact Matching to obtain an accurate comparison. For the two groups of prices, pairs with similar attributes such as transaction time, location, apartment area, floor, and building age are matched. Results show no significant price difference between the two groups. False reporting of housing prices may have occurred in the specific period and region with high transaction cancelations, but its effects are negligible and cannot be concluded as a cause of market distortions.

Citation status

* References for papers published after 2023 are currently being built.