Korea Land and Housing Corporation (LH) announced on the 4th that it will additionally freeze the rental deposits and rents of all LH rental housing nationwide for one year starting from January next year.
This additional freeze on rental conditions was implemented to alleviate the housing cost burden of residents, including vulnerable groups facing difficulties due to the prolonged COVID-19 pandemic and rapid inflation.
The freeze on rental deposits and rents applies to households residing in LH construction rental and purchased rental housing whose lease renewal contracts are due between January 1, 2023, and December 31, 2024. Considering resident equity, the freeze will be applied for one year from the start date of the renewal contract regardless of the contract signing date.
However, to minimize cumulative rental losses caused by the extension of the rent freeze, LH plans to implement a method where tenants sign a renewal contract with increased rental conditions but are exempted from paying the increased amount for one year. This will also ensure the faithful execution of the public institution’s financial soundness plan, including achieving a debt ratio below 200%.
Furthermore, to reduce approximately 117.6 billion KRW in rental operation losses resulting from the extension of the rental deposit and rent freeze, LH will independently devise profitability improvement measures and actively propose government budget increases for construction cost hikes and maintenance support to improve the quality of public rental housing.
Since March 2020 until December 2022, LH has already supported a total of 96.5 billion KRW by freezing and discounting rental conditions for rental housing and rental commercial spaces.
Additionally, to ease the economic burden on companies residing in rental industrial complexes, LH has reduced rents by 25% since May 2020, providing about 9.5 billion KRW in support, with the reduction period lasting until the end of this year.
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