Public Rental 100 Million-Won 'Maserati'... Seoul City "Contract Terminated, Will Thoroughly Crack Down" (Update) [2020 National Audit]

[Asia Economy Reporter Yuri Kim] It has been revealed that tenants of public rental housing in Seoul have been caught living in violation of eligibility criteria such as real estate ownership, income, and vehicle value in about 1,900 cases over the past five years.

According to data submitted by the Seoul Metropolitan Government to Cho Oh-seop, a member of the National Assembly Land, Infrastructure and Transport Committee from the Democratic Party of Korea, the number of ineligible tenants in Seoul public rental housing over the past five years was 1,896 cases. Cases where tenants were caught owning a house accounted for 1,108 cases, more than half, followed by income excess (551 cases), real estate excess (118 cases), vehicle excess (68 cases), and illegal subleasing (51 cases).

Among the 1,108 cases of house ownership, 437 cases, or 39.4%, occurred in redevelopment rental housing. This accounts for 82% of all ineligible tenants in redevelopment rental housing. The eligibility criteria for redevelopment rental housing require that tenants either reside in the relevant maintenance district or be owners of land subject to sale, and be non-homeowners who are heads of households qualifying for the first or second priority in special supply. Representative Cho interpreted that the special supply households in redevelopment rental housing are not subject to income criteria, so compared to other public rental housing where income criteria apply, the income level is relatively higher, resulting in more ineligible tenants owning houses. Regarding this, the Seoul Metropolitan Government explained, "As of the end of September, 66,833 households have been supplied in redevelopment rental housing, which accounts for the largest portion of SH Corporation rental housing," and "due to this, disqualifications due to house ownership are relatively higher than in other rental housing."

Vehicle ownership exceeding eligibility criteria was also pointed out as an ongoing issue. Among ineligible tenants in Seoul, 68 cases exceeded the vehicle criteria. One tenant living in Happy Housing owned a Maserati Ghibli valued at 99.08 million KRW, and another tenant living in National Rental Housing owned a Mercedes-Benz E300 valued at 53.52 million KRW but was evicted due to exceeding the criteria. These vehicles exceed the vehicle value limit of 24.68 million KRW for National Rental and Happy Housing by two to four times.

Public rental housing is supplied at monthly rents of about 100,000 to 300,000 KRW to vulnerable groups whose average monthly income per urban worker household is 100%, 70%, or 50% or less, depending on the type. At the Seoul city audit on the same day, Representative Cho said, "The mere fact that owners of luxury cars or houses live in public rental housing can lead to disputes over fairness, so thorough inspections of ineligible tenants are necessary."

In response, Seo Jeong-hyeop, Acting Mayor of Seoul, said, "The contracts of the detected ineligible tenants have already been terminated," and "We will conduct more thorough inspections."

Regarding this, the Seoul Metropolitan Government and SH Corporation stated that in the case of special supply for redevelopment rental housing, only house ownership is reviewed to ensure housing stability for existing tenants and resettlement rates in the area, resulting in a higher ineligibility rate than other types. For National Rental and others, according to the Public Housing Special Act, income and asset information is reviewed when renewing rental contracts, and house ownership is checked once a year by requesting a housing search from Seoul city; if deemed ineligible, the contract is terminated.