"My jeonse lease is ending soon, and I’m at a loss with my kids" — Seoul rental listings fall below 30,000

[The Financial News] The number of apartment jeonse and monthly rental listings in Seoul Special Metropolitan City has fallen below 30,000 for the first time since statistics began to be compiled. Analysts say a combination of the Oct. 15 real estate measures and tough lending regulations has triggered a severe shortage of rental listings.

According to Asil, a real estate big data firm, as of the 6th there were 14,195 jeonse (lump-sum lease) apartment listings and 14,525 monthly rental listings in Seoul Special Metropolitan City, for a total of 29,720. This is the first time since April 2023, when Asil began compiling the data, that the number of rental apartment listings in Seoul has fallen below 30,000.
Compared with April 1, 2023, at the start of the data series, when there were 70,074 listings, rental listings in Seoul Special Metropolitan City have plunged by 57.5%. After the Oct. 15 real estate measures designated all of Seoul as a land transaction permit zone, regulations made it difficult to sell homes with existing jeonse tenants. As a result, more landlords appear to have switched to moving in themselves in preparation for future sales, rapidly depleting supply on the market.
In fact, on the day the Oct. 15 real estate measures were announced, there were 44,055 rental listings, but that number fell by 32.5% (14,335 listings) in just six months. Jeonse listings dropped faster, by 37.6%, compared with a 26.2% decline in monthly rental listings. The decrease has been especially stark in outer districts of Seoul Special Metropolitan City such as Guro-gu (from 796 to 291), Nowon-gu (from 1,327 to 502), and Jungnang-gu (from 496 to 196).
As jeonse and monthly rental units quickly disappear from the market, concerns over jeonse supply and sharp price increases are intensifying. According to KB Real Estate, the jeonse supply-demand index for apartments in Seoul Special Metropolitan City jumped from 157.7 in October last year to 172.4 in March this year. An index above 100 indicates that demand in the market exceeds supply.

Jeonse prices are also on the rise. According to weekly apartment price trends for the fifth week of March (as of the 30th) from the Korea Real Estate Board (KREB), jeonse prices for apartments in Seoul Special Metropolitan City climbed 0.15% from the previous week, marking 14 consecutive months of increases since the second week of January last year. Outer districts where shortages are particularly acute, such as Dobong-gu (0.28%), Nowon-gu (0.24%), and Guro-gu (0.23%), saw especially steep price gains.

Kim Inman, Director of the Kim Inman Real Estate Economy Research Institute, explained, "With the designation of land transaction permit zones effectively making it impossible to sell homes with existing jeonse tenants, landlords are choosing to move in themselves instead of extending contracts, and jeonse supply itself is drying up." He added, "On top of that, even jeonse loans conditional on transfer of ownership have been blocked, leaving ordinary households unable to secure affordable jeonse units in newly built complexes."
[email protected] Kim Hee-sun Reporter