[Desk Column] At This Point, It's a Collective 'Ripley Syndrome'

How awkward it must be. Hong Nam-ki, the Deputy Prime Minister and Minister of Economy and Finance, who is supposed to be the control tower of real estate policy, has been caught in the trap of the Lease Protection Act 2 and was forced out of his jeonse (long-term deposit lease) house. Moreover, the house he put up for sale to set an example in disposing of surplus housing fell through due to a change of heart by the tenant, drawing the market's attention.

After Asia Economy exclusively reported this fact on the 14th, the issue was raised even during the National Assembly audit, leaving both Deputy Prime Minister Hong and the government in an awkward position. Online communities opposing the government's policy are flooded with reactions calling it "self-inflicted."

However, no one finds this situation entirely comfortable. Just as Deputy Prime Minister Hong is both a landlord and a tenant, this is something that anyone could easily experience in future lease contracts.

By some luck, the reporter has benefited greatly from 'good landlords' while living as a tenant for nearly 20 years. I lived in one house on a jeonse contract for eight years and resided as a tenant in a respectable large new apartment complex for five years. During this time, there was no unreasonable demand from landlords to increase the deposit. Landlords took responsibility for what they should, tenants handled their part appropriately, and we lived together in a truly 'good and harmonious' way. It was a jeonse life where common-sense agreements were possible without having to scrutinize the provisions of the Housing Lease Protection Act one by one.

But with the sudden enforcement of Lease Protection Act 2, landlords and tenants have become a society that puts 'law' first. Every time a contract is renewed or a new lease contract is signed, they have to rack their brains over the 'law.'

A friend whose two-year jeonse contract ends next spring says the 'contract renewal request' chance is unwelcome. Even though he can live two more years by not moving and only increasing the deposit by 5%. Rather, he feels bleak thinking about the spring of 2023 when his four-year residence ends. "The jeonse price rose by more than 10 million won in just two months. I worry how much it will rise in three years," he laments, a concern shared by many tenants. The Lease Protection Act 2, created to ease tenants' worries, has only brought them anxiety and insecurity.

Now landlords fear tenants. They have to rent out for four years without moving, so they might even have to conduct interviews. Tenants are equally uneasy about landlords, fearing vaguely that landlords might find a pretext to evict them. There are no longer 'good landlords' or 'good tenants' in the market.

Given this reality, the government's claim that tenants' housing stability has improved due to the contract renewal request right is unconvincing. Even Deputy Prime Minister Hong himself, who is suffering in the process of finding a jeonse house and selling owned housing, says that "the effect of housing stability for tenants is appearing" due to the enforcement of Lease Protection Act 2, which is puzzling.

Tenants who were refused contract renewal due to landlords' intention to move in themselves are scrambling to prepare deposits that have risen by tens of millions to over 100 million won within a month or two, and are running around desperately looking for jeonse houses. Is this not visible? If it is invisible, or if it is visible but deliberately ignored, one wonders if the real estate policy officials are suffering from 'the Ripley syndrome.' Are they creating their own worldview and only seeing what they want to see?

The blame also points to the massive bureaucratic organization. They hastily create policies tailored to the tastes of their superiors without proper review, and then scramble to clean up the ensuing side effects. How can one explain the process by which the Lease Protection Act 2, which was concluded through over ten years of various research and review processes to have more side effects than benefits, suddenly transformed overnight into a panacea to stabilize the market without any meaningful public consultation?

Gol-gyeong-ji-shin (a Korean idiom meaning 'to learn from past mistakes'). It is even more worrisome that there is no one to give frank advice, like a fishbone stuck in the throat of the real estate policy control tower that is heading in the wrong direction. Could it be that the entire massive bureaucratic organization has collectively fallen into Ripley syndrome?