Minister Park Sang-woo: "Corporate Long-term Lease Will Become a New Model Replacing the Jeonse System"

15th 'Meeting for the Introduction of Corporate Long-term Lease'

The government is pushing to introduce corporate long-term rental housing to replace the jeonse system. It plans to lift rent regulations, which have been obstacles to long-term rentals, and also provide tax support.

On the 15th, Park Sang-woo, Minister of Land, Infrastructure and Transport, stated at a 'Meeting for the Introduction of Corporate Long-term Rental Housing' held at the Taeheung Building in Seoul, "There are many jeonse fraud cases, and ultimately, we want to create long-term rental housing that can replace the jeonse system."

Park Sang-woo, Minister of Land, Infrastructure and Transport, speaking at the "Meeting for the Introduction of Corporate Long-term Lease" held at Taeheung Building in Seoul on the 15th. Photo by Ministry of Land, Infrastructure and Transport

Minister Park plans to activate corporate long-term rentals so that private businesses can lease housing for extended periods. He said, "Unlike New Stay or public housing, corporate long-term rentals operate purely in the private sector," adding, "The government will assist private businesses in carrying out their projects."

The plan aims to enhance housing stability through corporate long-term rentals. Under the general monthly rent or jeonse system, tenants may have to vacate the house after 2 to 4 years of lease contracts, even if they do not wish to. The government intends to resolve such housing insecurity through corporate long-term rentals, which are based on a minimum lease period of 20 years or more.

Minister Park is promoting the relaxation of rent regulations to introduce corporate long-term rentals. He said, "Rent regulations are piled up like a mountain," and "Many of these need to be abolished or improved significantly." The plan is to ease rent regulations to enable private businesses to proceed with corporate long-term rental projects.

Previously, initial rent was restricted when conducting corporate rental housing projects, and rent increases were also limited. The Ministry of Land, Infrastructure and Transport will ease these regulations to support private businesses' corporate long-term rental projects.

Photo of the "Meeting for the Introduction of Corporate Long-term Lease" held on the 15th at Taeheung Building in Seoul. [Photo by Ministry of Land, Infrastructure and Transport]

He also emphasized the consistency of the corporate rental housing system. Minister Park said, "There have been many industry demands to guarantee the consistency of 10-year and 20-year long-term rental systems," adding, "Building trust is the most important part." He continued, "We have agreed to work together with the private sector to secure land, simulate construction costs, and determine appropriate rent levels."

Additionally, tax support will be rationally reformed to suit the characteristics of long-term rental operations.

The Ministry of Land, Infrastructure and Transport plans to announce the broad framework of the corporate long-term rental system next month. It aims to present it in the form of a bill before the regular National Assembly session in September.