Villa Appropriate Jeonse Price Revealed... Real Estate Agents Association "Preventing Jeonse Fraud Damage"

Association 'KARIS' Data Utilization
'Caution' Notice for Suspicious Transactions
"Based on Real Transaction Data, Accuracy↑"

A system that allows users to check the appropriate Jeonse price for villas (multi-family and row houses) will be launched. This is expected to help prevent Jeonse fraud by enabling verification of abnormal transactions.

Lee Jong-hyuk, President of the Korea Association of Certified Real Estate Agents, is speaking at the press briefing for the 'Jeonse Price Abnormal Transaction Verification System' held on the 5th at the association hall in Gwanak-gu, Seoul. Photo by Kwon Hyun-ji

On the 5th, the Korea Association of Realtors held a press briefing at its office in Gwanak-gu, Seoul, announcing the start of operation of the ‘Jeonse Price Abnormal Transaction Verification System.’ The association added a villa appropriate Jeonse price analysis function to the currently operated ‘Real Estate Integrated Index System (KARIS).’

Lee Jong-hyuk, president of the Korea Association of Realtors, explained the purpose of development, saying, “The main cause of Jeonse fraud was ‘information asymmetry.’ In particular, tenants found it difficult to grasp the appropriate Jeonse price. By developing a system that informs tenants of the appropriate Jeonse price at the time of contract, we aim to support the prevention of Jeonse fraud.”

This system automatically calculates the appropriate Jeonse price by finding transaction cases of villas with similar area located within 100 to 500 meters of a specific villa. It comprehensively reflects market price fluctuations, density, and similarity at the time of price inquiry. By entering the villa address, it provides the average Jeonse price range of surrounding villas. If the Jeonse price of the villa to be contracted exceeds the range, a message stating ‘This corresponds to a caution level’ appears.

The association emphasized that this can supplement public data. President Lee said, “Even now, Jeonse price information for villas and other multi-family houses can be checked through the government’s ‘Safe Jeonse 2.0,’ but there are limitations because the reporting period for the Jeonse and monthly rent reporting system is short and deposits under 60 million won are not subject to mandatory reporting. This system is based on actual transaction-based sales and lease contract information, enabling rapid and accurate information provision.”

The system is currently applied to the ‘Hanbang’ transaction information network program used by licensed realtors. The association plans to first implement the system for realtors and then make it available to the general public. For the public version, rights analysis and special contract clause analysis information will be added for more precise judgment. The types of housing available for inquiry will also be expanded from villas to single-family and multi-family houses.

President Lee said, “By utilizing the appropriate Jeonse price estimation system, not only can transaction safety be enhanced, but it can also supplement the Ministry of Land, Infrastructure and Transport’s actual transaction data to detect abnormal signs when drafting contracts for villas and other multi-family houses. We expect this to greatly help resolve information asymmetry issues, minimize contract-related disputes, efficiently prevent Jeonse damage, and protect citizens’ property rights.”