Hong Jiseon, Land Minister: "Fewer move-in-ready homes driving rent hikes... Supply is the fundamental solution"

"Taking concerns over monthly rent burdens seriously
Shift from jeonse to monthly rent driven by structural changes"

Hong Jiseon, Minister of Land, Infrastructure and Transport, said, "The biggest cause of rising jeonse and monthly rent prices is the decline in move-in-ready housing due to sluggish construction starts," adding that the solution would be found through increased supply.

In a social media post on the night of the 21st, Minister Hong said, "Since the early 2020s, the trend of fewer jeonse contracts and more monthly rental contracts has been accelerating."

Hong Jiseon, Minister of Land, Infrastructure and Transport. The Asia Business Daily archive.

Explaining the recent decline in jeonse listings and increase in monthly rental listings, she said, "Rather than a sudden development, this is a structural change in the rental market driven by factors including the rise in single-person households and the fallout from jeonse fraud."

"The fundamental solution is supply," she said. "From January through August this year, housing permits and construction starts in Seoul increased by more than 40% compared with last year, and around 100,000 publicly provided homes in the Seoul metropolitan area will be occupied by the end of next year."

She also said the government would expand housing welfare benefits for young people. "Through the monthly rent tax credit, non-homeowning workers with annual gross salaries of 80 million won or less can deduct 15% to 17% of their rent from their taxes, up to 10 million won a year, if they live in a qualifying home," she said. "If their annual gross salary is 55 million won or less and their monthly rent is 1 million won, they can receive a deduction of up to 1.7 million won a year."

"We provide monthly rent assistance of up to 200,000 won per month for young people," she added. "We will continue looking for ways to ease the burden of rent."

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