1139 Units Owned 'Villa King' Dies, 200 Tenants Unable to Receive Jeonse Deposits

Cannot Claim Reimbursement from Landlord... Subrogation Payment Halted
Minister Won Hee-ryong "Will Do Our Best to Prevent Jeonse Damage"

Villa-dense area in downtown Seoul / Photo by Mun Ho-nam munonam@

[Asia Economy Reporter Noh Kyung-jo] As the so-called 'Villa King,' who rented out more than 1,000 villas and officetels in the Seoul metropolitan area, passed away, tenants are suffering damages such as not receiving their jeonse deposit refunds on time.

According to the Housing and Urban Guarantee Corporation (HUG) on the 12th, Kim, a man in his 40s known as the Villa King, died last October, and subrogation payments to tenants who subscribed to the jeonse deposit guarantee insurance have not been made.

Subrogation payment is a method where if the landlord fails to return the deposit after the contract period expires, the guarantee institution pays the deposit to the subscriber (tenant) on behalf of the landlord and later claims reimbursement from the landlord.

In this process, the tenant must notify the landlord of the termination of the lease contract. However, since the landlord Kim passed away, the conditions for contract termination have not been met, and the subrogation payment procedure has not proceeded. This reveals a systemic loophole in the jeonse deposit guarantee insurance that cannot respond to the landlord's death situation.

It is known that at least 200 tenants of Kim's properties have not received their deposits from HUG.

For subrogation payment, inheritance by relatives within the fourth degree of kinship is required, which is expected to be difficult. Kim had 6.2 billion KRW in unpaid comprehensive real estate taxes last year, resulting in the seizure of his properties, and due to the decline in real estate prices, even if the houses are sold, it is highly likely that the deposits cannot be refunded.

Kim's only blood relatives, his parents, have unclear intentions regarding inheritance. If the parents do not inherit, tenants will have to wait until the court appoints an administrator for the inherited property.

A HUG official said, "Due to regulations, subrogation payments have not been made," and added, "We are persuading Kim's parents to inherit."

Since 2020, Kim has been purchasing villas and officetels in the metropolitan area through gap investment (buying with jeonse deposits), and as of June this year, he reportedly owned 1,139 housing units. Victims who have not received their deposits from Kim created an online victim cafe in April this year. Currently, there are about 450 members.

On the previous day, Won Hee-ryong, Minister of Land, Infrastructure and Transport, stated on his Facebook, "Victims can continue living in their current residences during the several months the inheritance process takes, and jeonse loan guarantees can be extended, so there is no need to worry greatly for the time being," adding, "The Jeonse Damage Support Center provides legal consultations as well as temporary housing."

He continued, "Next year, we plan to support the Housing and Urban Fund with a budget to enable jeonse deposits to be supported at lower interest rates," and added, "We will do our best so that ordinary people do not shed tears due to jeonse damages."