"Please Raise the Rent by 300,000 Won" Listings Surge... Accelerating Jeonse Disappearance

[Financial News] #. In Myeongil-dong, Gangdong-gu, Seoul, a 59㎡ unit in 'Raemian Solbennu' was recently leased with a deposit of 50 million won and a monthly rent of 2.1 million won. It is a contract renewal, and the rent has increased by about 17% compared to the previous 1.8 million won. In the case of Gangnam-gu, where jeonse prices are high, the number of monthly rental listings exceeded 5,000 after the '6.27 Measures'.
According to the industry on the 13th, the conversion of jeonse to monthly rent is accelerating. As monthly rent prices continue to hit record highs and loan regulations overlap, the demand for monthly rent is growing even more.
According to KB Real Estate, the monthly rent index for Seoul apartments rose by 1.46% in June. The monthly rent index recorded 126.6, continuing its record high streak. The Seoul metropolitan area monthly rent index also reached an all-time high of 127.3 in June since the statistics were first compiled.
The proportion of monthly rent transactions is also increasing. According to the Seoul city, the proportion of monthly rent in total rental transactions from January to June this year was 42.7%. Except for March (38.4%), it has exceeded 40% this year.
The disappearance of jeonse is expected to accelerate further. This is because the '6.27 Measures' have banned 'conditional jeonse loans upon transfer of ownership' for newly built apartments. After the measures, the number of monthly rental listings is also increasing, especially in high-priced jeonse areas like Gangnam.
According to Asil, the number of monthly rental listings for apartments in Gangnam-gu increased from 4,672 on June 27 to 5,068 on July 13. During this period, Seocho-gu also increased from 4,262 to 4,391, and Songpa-gu increased from 1,184 to 1,221. The total number of monthly rental listings for Seoul apartments recorded over 18,000 on June 27, when the measures were announced, but surpassed 19,000 on July 11.
A representative from D Realty in Daechi-dong said, "It is not easy to find tenants who can afford the jeonse deposit in Gangnam with cash," adding, "Landlords are turning to receiving monthly rent."
Experts predict that the disappearance of jeonse will accelerate further. The government is also considering applying the Total Debt Service Ratio (DSR) regulation to jeonse loans. There is concern that if the DSR regulation for jeonse loans is implemented following the '6.27 Measures', jeonse listings may dry up.
Some argue that the acceleration of monthly rent could have positive effects, such as blocking gap investments. Some experts are even advocating for the abolition of the jeonse system itself.
There are also concerns. Professor Go Joon-seok of Yonsei University's Sangnam Institute of Management said, "There are claims that the jeonse system should be abolished, but if it disappears, the burden of housing will increase, and the possibility of owning a home will become even more distant, which is a side effect that must be considered."




ljb@fnnews.com Lee Jong-bae Reporter