Assemblyman Park Sang-hyeok Proposes Amendment to Jeonwolse Reporting System on the Day
Plan for Swift Processing of Lease 3 Laws... Concerns Over Side Effects Also Raised
[Asia Economy Reporter Moon Jiwon] The amendment bills for the 'Three Lease Laws'?the Jeonwolse Reporting System, the Jeonwolse Rent Cap System, and the Contract Renewal Request Right System?will all be proposed on the 6th. The ruling party and the government plan to process these bills as quickly as possible.
According to the National Assembly and the Ministry of Land, Infrastructure and Transport, Park Sanghyuk, a member of the Democratic Party of Korea, will lead the proposal of the amendment to the "Real Estate Transaction Reporting Act" introducing the Jeonwolse Reporting System on the afternoon of the same day.
The amendment is similar to the one proposed during the 20th National Assembly but changes the reporting obligation from licensed real estate agents to the transaction parties themselves. This is interpreted as a measure considering the opposition from licensed real estate agents.
The Jeonwolse Reporting System requires that Jeonwolse transactions report actual transaction prices within 30 days, similar to housing sales. If the amendment passes, the transaction parties must report the deposit, rent, lease period, and payment dates for the contract deposit, interim payment, and balance to the relevant local government.
By reporting the Jeonwolse contract, a confirmed date is automatically assigned, so tenants do not need to obtain a separate confirmed date.
However, since the bill stipulates that the target areas for enforcement will be determined by enforcement ordinances, it is also suggested that the system may first be implemented in metropolitan area housing such as Seoul.
The Jeonwolse Reporting System serves as the foundation for operating the Contract Renewal Request Right System and the Jeonwolse Rent Cap System.
Several amendment bills to the Housing Lease Protection Act, which introduce the Jeonwolse Rent Cap System and the Contract Renewal Request Right System, have already been proposed.
If these bills pass the National Assembly as planned by the ruling party and government, all Jeonwolse housing will be subject to restrictions similar to registered rental housing, blurring the boundaries between the two.
Registered rental housing business operators receive various tax benefits but must comply with a rental obligation period of up to eight years and cannot increase rent by more than 5% annually.
While there are expectations that the amendment will curb rapid rent increases in the Jeonwolse market, there are also considerable concerns about side effects such as landlords sharply raising deposits ahead of the system’s implementation.
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