Minister of Land, Infrastructure and Transport Won Hee-ryong speaks during the National Assembly's audit of his ministry, Friday. Yonhap

By Lee Kyung-min

The land minister said the recent downward trajectory of housing prices is "not sharp," and that the dip of around 6 percent in the first eight months of this year is relatively small compared to the over 50 percent increase in housing prices over the past few years.

The real estate market slowdown is a consequence of changes in the macro-economic and financial conditions, such as interest rate hikes, according to Minister of Land, Infrastructure and Transport Won Hee-ryong.

This is why he stopprd short of taking steps to ensure a soft landing to limit the fallout of what some market watchers expect to be the onset of a rapidly cooling real estate market.

"It is not a plunge," Won said during an audit of the ministry at the National Assembly Land, Infrastructure and Transport Committee, Friday.

Housing prices have increased by about 50 percent over the past few years, in his view, and the figures falling by about 6 percent over the past few months is not an indication of market turmoil.

"Sellers of houses are still demanding prices that are too high for many," he said. "The market principle whereby prices are determined by supply and demand has been and still is largely dysfunctional, a reason why it is too early to characterize the recent developments as the beginning of a certain crisis stage," Won added

The assessment came in response to Rep. Yoo Gyeong-joon of the ruling People Power Party. The member of the National Assembly Land, Infrastructure and Transport Committee asked for the minister's opinion on growing calls to implement preemptive measures to deal with what he fears is an impending real estate market recession.

Data cited by the lawmaker from Korea Real Estate Board showed that the index for Seoul's apartment transaction prices registered a 6.63 percent drop from January to August, to the lowest levels since 2006 when the government began compiling related data.

Meanwhile, most consider housing prices are still elevated, as indicated by a survey of 1,032 people aged 18 and older.

According to the survey conducted by Research DNA, a market research firm, over seven out of 10 people said housing prices are "expensive." Only one in 10 said the prices are "appropriate," while 9.1 percent said they were too low.