"Seoul City to Preemptively Crack Down on Jeonse Fraud with Focused Raids Near New Villas"

Intensive Crackdown on Suspected Kkangtong Jeonse Listings in Dense Areas
Inspection of Illegal Brokerage Including Double Contracts and False Listings
Disqualification Investigation for Over 160,000 Licensed Realtors

Seoul City is launching a focused crackdown to preemptively block jeonse fraud, especially in areas where suspicious "empty-can jeonse" listings are concentrated during the moving season.

A real estate agency in Seoul. The photo is unrelated to the article content. Photo by Jinhyung Kang aymsdream@

On the 19th, Seoul City announced that it will conduct on-site guidance and inspections centered around real estate agencies in newly built villa areas, in cooperation with 25 autonomous districts. The main targets of the intensive inspection are real estate agencies mediating newly built properties where the jeonse price is high compared to the sale price.

When the sum of the mortgage loan and the jeonse deposit is similar to or exceeds the housing sale price, there is a high possibility of becoming an "empty-can jeonse," where tenants cannot recover their jeonse deposit after the lease expires due to the deposit being higher than the house value.

The main inspection items for this focused crackdown include ▲signing double contracts ▲posting or advertising false listings ▲omission of real estate rights documentation ▲unlicensed or unregistered illegal brokerage ▲excessive receipt of brokerage fees. The city plans to thoroughly inspect these items and take measures such as administrative sanctions and referral for investigation if violations are confirmed.

Based on accumulated data from the 'Jeonse Price Consultation Center' and the 'Real Estate Transaction Trend Analysis System,' thorough inspections will be conducted. The city emphasized that it will respond with a zero-tolerance policy, including follow-up investigations and prosecutions for illegal activities.

Last year, through joint crackdowns with 25 autonomous districts, Seoul City detected 3,272 cases of illegal real estate activities. Administrative actions included ▲56 license cancellations ▲197 business suspensions ▲1,889 fines (approximately 2.4 billion KRW) ▲1,000 warnings and corrections ▲6 license cancellations or suspensions, and 124 cases were prosecuted.

Additionally, a comprehensive investigation into disqualifications will be conducted targeting about 165,000 licensed real estate agents who received their certification from Seoul City. According to revised laws, criminal records and court rulings of real estate agents will be reviewed, and if violations are found, administrative actions such as license cancellation or suspension will be enforced.

Since July last year, a legal amendment has expanded the scope of crimes subject to real estate agent license cancellation from imprisonment sentences to imprisonment with labor or higher sentences.

Currently, Seoul City operates a rapid response team for illegal real estate activities. It also accepts reports on suspicious brokerage activities such as jeonse fraud, brokerage by unregistered persons or brokerage assistants, and demands for brokerage fees exceeding the statutory rate. Upon receiving citizen reports, the team conducts prompt inspections on the same day as a principle to thoroughly block illegal brokerage activities.

Jo Nam-jun, Director of the Urban Space Headquarters of Seoul City, said, "We plan to continuously provide guidance and inspections to prevent damage from real estate transactions. We will respond with a zero-tolerance policy to acts threatening citizens' housing stability and strive to create a transparent real estate transaction environment."