Seoul Mayor Oh Se-hoon said on the 7th, "Because of the jeonwolse crisis, all of Seoul is becoming a 'housing hell,'" and said, "The government must come up with extraordinary measures to revive the private rental market."
On this day, the mayor posted on social media (SNS) an article titled "Jeonwolse hell, extraordinary measures are needed" and stated accordingly.
The mayor said, "Cries are erupting everywhere from people driven out as jeonwolse refugees who say they can no longer live in Seoul," and noted, "In July, the average monthly rent for apartments in Seoul hit a record high of 1.62 million won. Jeonse prices have jumped 9.95%, and the drought of jeonse listings is still continuing."
He added, "Perhaps the government could not turn a blind eye to the pain on the ground, as there is word that it is reviewing ways to reduce the comprehensive real estate tax burden on corporate-type rental business operators."
The mayor emphasized that measures are needed for rental business operators, which he has been calling for. Registered private rental housing in Seoul totals 407,000 units, accounting for about 20% of all tenant dwellings. There are about 93,000 registered rental business operators.
The mayor said, "They have complied with the government-mandated minimum rental periods and accepted limits on rent increases, in return for which they received tax preferences," and added, "However, those benefits were abolished under the Aug. 3 tax reform. It even forced private rental apartments whose mandatory rental terms had already been automatically canceled to be sold by 2027 to keep their existing benefits."
He went on, "If registered rental business operators are branded as speculators and existing tax benefits are removed, some supply may move to the sales market," and added, "But that also eliminates dwellings where tenants could live long-term without worrying about rent hikes or contract termination. In the end, the damage falls on ordinary people."
The mayor also said, "In Seoul alone, more than 20,000 registered rental apartments are set to reach the end of their mandatory rental periods this year, and about 30,000 units are expected to expire by 2028," and noted, "We cannot shake the fear that the jeonwolse hell we are experiencing now may be only the beginning."
He added, "Even now, regulations should be comprehensively re-examined, and private rental business should be institutionalized as one pillar of stable rental housing supply," and said, "We need to establish a legal definition for 'corporate-type private rental business operators' and clearly set out support and obligations so a stable rental market can form."
The mayor said, "Above all, the fundamental solution to today's jeonwolse hell is to comprehensively re-examine the real estate policy stance centered on 'owner-occupancy,'" and added, "With a binary approach that only owner-occupancy is good, we can neither control home prices nor revive the jeonwolse market."