Monthly Rent Leases for Seoul Apartments and Villas Hit 70.5% of Total

In the first quarter of this year, monthly rent leases accounted for 70.5% of all rental agreements in Seoul, an increase of 6.2 percentage points compared to the same period last year. This figure approached record highs, with apartment monthly rent leases standing at 50.8% and monthly rent leases for non-apartment housing like villas reaching 79.4%.

A clear trend towards choosing monthly rent over jeonse (lump-sum deposit lease) has emerged, driven by a decline in jeonse availability and ongoing issues with jeonse fraud. Regulations such as strengthened mandatory residency requirements for multi-homeowners and a reduction in jeonse loans are also believed to have spurred this market shift towards monthly rents.

In March, Seoul's apartment monthly rent supply and demand index reached 107.5, the highest since October 2021, with the average monthly rent at 1.528 million won. The index for the northern district (Gangbuk) exceeded the average at 109.1. In these northern areas, monthly rent leases were observed with deposits of 100 million won and monthly rents ranging from 2.5 to 3.6 million won.

Housing permits in Seoul during the first quarter fell sharply by 62.4% year-on-year to 5,632 units. Considering that it takes three to five years from permit issuance to actual occupancy, analyses suggest that a housing supply shortage could worsen in the future.