Since lending rules were tightened, the "shift from jeonse to monthly rent" has been accelerating. With the fallout from jeonse fraud continuing, a drop in jeonse listings and tougher loan regulations have pushed the share of monthly-rent contracts above 60% of all lease agreements. Six out of 10 lease agreements are now monthly rent. As this shift speeds up, average monthly rents are also rising, with Seoul's monthly rent easily topping 1 million won.
According to the Ministry of Land, Infrastructure and Transport on the 1st, the number of jeonse transactions in August was 72,573, down 17.7% from a year earlier. Over the same period, monthly-rent transactions (including key-money-based monthly rent and semi-jeonse) rose 16.4% to 141,182.
The share of monthly rent within lease contracts is also expanding. From January to August this year, monthly-rent transactions accounted for 62.2% of all lease transactions. The average share of monthly rent over the past five years is 49.4%, showing an annual expansion of monthly rent. The share of monthly rent in all lease transactions was 55.0% in 2023 and 57.4% last year.
Monthly-rent transactions for apartments are increasing, but the rise is faster for non-apartments such as villas and officetels. The share of monthly rent within apartment lease transactions rose from 43.6% in 2023 to 43.7% in 2024 and 46.8% in August 2025. In contrast, for non-apartments, the monthly-rent share was 65.9% in 2023, 69.6% in 2024, and 76.0% in August 2025, showing a faster expansion than for apartments.
The burden of monthly rent is also growing. According to the Korea Real Estate Board (REB) statistics system, the national average monthly rent per household in August was 807,000 won. Seoul had the highest monthly rent. The average monthly rent in Seoul was 1,031,000 won, with the Gangnam area at 1,173,000 won and the Gangbuk area at 1,096,000 won.
The expansion of monthly-rent transactions is the result of a combination of factors, including base-rate cuts, a decline in jeonse supply, and loan regulations. Due to the base-rate reduction, even if landlords deposit jeonse key money in a bank, the annual yield is only in the 2% range. But the jeonse-to-monthly conversion rate (the rate applied when converting jeonse deposits to monthly rent) is around the 5% range. From a landlord's perspective, receiving monthly rent is more advantageous than jeonse.
As jeonse supply declines, supply-demand imbalances are emerging, increasing the volume of monthly-rent listings. With a shortage of dwellings supply, move-in volumes have fallen, and as more tenants exercise their jeonse renewal rights, jeonse listings have decreased compared with before.
In addition, following the 6·27 measures, the ban on jeonse loans conditional on transfer of ownership has further intensified the shortage of jeonse listings. Jeonse loans conditional on transfer of ownership are used when those who received allocations pay purchase prices or remaining balances with jeonse deposits. In other words, the method in which an allottee uses a tenant's jeonse deposit to raise the purchase price or remaining balance has been banned. As a result, more listings have appeared that reduce the jeonse deposit and instead collect monthly rent.
Moreover, as the guarantee ratio for jeonse loans has been reduced, cases are increasing in which people who cannot finance deposits through loans pay monthly rent instead.
Ham Young-jin, head of the Real Estate Research Lab at Woori Bank, said, "Since the second half of last year, rates have been cut, and the rate is now down about 1 percentage point," adding, "Even if you put a 1-year time deposit in a bank, the annual yield is only 2.4% to 2.5%, whereas the jeonse-to-monthly conversion rate is around the 5% range. If you have the capacity to return deposits, taking monthly rent is far more advantageous."
Ham said, "Due to a decrease in move-in supply and an increase in the number of jeonse renewal right claims, jeonse listings circulating in the market are declining," explaining, "This also drives up monthly-rent transaction volumes across the Seoul metropolitan area and non-metropolitan areas, and across apartments and non-apartments alike." Ham continued, "Loan regulations also have an impact, as the jeonse guarantee ratio has fallen, especially in the Seoul metropolitan area, reducing the total amount of jeonse loans compared with before," adding, "If you want to maintain a lease now, the reality is you have no choice but to switch to key-money-based monthly rent."