"Renewal Deadlines Overlap"... Former Dunchon Jugong Emerges as Biggest Beneficiary of Extended Actual Residence Exemption in LTPZ [Real Estate AtoZ]

Olpapo in Dunchon-dong Benefits from Overlapping Jeonse Expirations and Extension of Residence Exemption
Move-in Deadline Deferred up to Two Years for Renewed Jeonse Contracts
6,181 Units Held by Association Members Now Easier to List for Sale
"Extension of the Residence Exemption Is a Dunchon Jugong Support Measure"

Olympic Park Foreon (Olpapo), located in Gangdong-gu, Seoul and known as the largest apartment complex in Korea, has emerged as the primary beneficiary of the expanded exemption period for actual residence requirements in land transaction permit zones (LTPZ). The Ministry of Land, Infrastructure and Transport had earlier announced its plan to extend the deadline for applying for the exemption from actual residence requirements in LTPZ from the end of this year to the end of next year, effectively adding one more year. As the expiration of the massive number of two-year jeonse (long-term lease) contracts in the newly occupied complex comes due in the latter half of this year and contract renewals have followed, there is growing consensus that this policy change will allow association members who had leased out their units to bring properties to market.

According to the real estate industry on September 18, Olympic Park Foreon, the reconstructed Dunchon Jugong complex, has 6,181 out of a total of 12,032 units allocated to association members, excluding public pre-sale and rental housing. The two-year jeonse contracts signed by these association members when they moved in November 2024 are set to mature this November. This maturity exactly coincides with the Ministry of Land's newly recognized renewal contract exemption period, which runs from October 1, 2026 to December 31, 2027. However, owners of public pre-sale units remain subject to the mandatory residence requirement under the Pre-Sale Price Ceiling Regulation, meaning they must move in themselves by November 2027 at the latest.

The day before, on September 17, the Ministry extended the actual residence exemption until the end of 2027, permitting a delay of up to two years in the move-in date for new homeowners if the previous tenant renews the lease contract—this benefits buyers without homes who purchase in the LTPZ area. The relevant enforcement ordinance has been pre-announced and is slated to take effect from October 1.

Market analysts expect the primary impact of these new measures to focus on Olpapo, which has more than 10,000 units. Sangwook Chae, CEO of Connected Ground, commented on his social media, "The extension of the exemption from actual residence requirements in land transaction permit zones was a measure to support Dunchon Jugong."

From mid-2026, renewal contracts started picking up at Olpapo. According to data reported to the Ministry’s public transaction price disclosure system (based on contract dates), there were no jeonse renewal contracts at this apartment complex until May 2026. The first two renewals appeared in June, seven in July, and five in August. This month, there have been 23 jeonse contracts so far, of which 12 (52.2%) were renewals. For an 84-square-meter unit in Olpapo, renewed jeonse contract prices range from 900 million won to 945 million won, which is lower than new contract prices for the same unit type—ranging from 1.3 billion won to 1.64 billion won.

The latest government measure has opened up an exit route for owners who had been unable to sell due to existing tenant protections, as sales with an incumbent tenant under a renewed lease are now allowed. Notably, of the 26 jeonse renewal contracts signed in 2026, 20 have renewed lease terms that start between November 2026 and February 2027, meaning they will fall within the period covered by the new exemption. Even for larger units allocated entirely to association members, renewal contracts have been signed, facilitating sales with tenants in place.

An official at a nearby real estate agency noted, "Owners no longer need to force their tenants out to sell their units," and added, "This helps prevent a sudden oversupply of demand for jeonse in surrounding areas like Songpa or Gyeonggi Province, which could have driven up prices."

This is not the first time Olpapo has been tagged as a "Dunchon bailout" project. The Pre-Sale Price Ceiling Regulation's mandatory residence rule was first implemented in February 2021 under the Moon Jae-in administration. The Yoon Suk-yeol administration announced plans to abolish this requirement as part of its January 3, 2023 measures, just as Dunchon Jugong’s public pre-sales were about to begin, which led to criticism that it was a measure for a specific project. However, the proposal was blocked by the National Assembly, where the Democratic Party held a majority. The rival parties later compromised in February 2024, determining that buyers must only move in within three years of initial occupancy.

Won Gap Park, Chief Real Estate Specialist at KB Kookmin Bank, commented, "The new measure does not apply to those who purchased public pre-sale units subject to the Pre-Sale Price Ceiling Regulation’s mandatory residence rule. However, for association members, it provides a significant relief, as they can now sell with tenants in place even if the tenant exercised their renewal claim, giving association members a clear advantage."

This content was produced with the assistance of AI translation services.