Joint Inspection of Nationwide Rental Business Operators from Tomorrow... Investigation of Public Duty Violations within 5 Years

5% Rent Increase Violation Results in 30 Million KRW Fine
Nationwide Joint Investigation... Focused Management in Seoul and Metropolitan Area
Limited to Last 5 Years Considering Fine Statute of Limitations

[Asia Economy Reporter Moon Jiwon] The government will intensively inspect whether registered rental business operators comply with their public obligations starting next month. If violations such as the 5% rent increase limit and breach of the rental obligation period are detected, strict measures will be taken, including imposing fines of up to 30 million KRW and reclaiming tax benefits.

The Ministry of Land, Infrastructure and Transport announced on the 31st, "We will actively promote joint inspections with related agencies to verify compliance with rental business operators' public obligations," adding, "Strict measures such as fines and tax benefit recovery will be imposed on those found violating obligations during the inspection process."

The rental registration system was introduced in 1994 to support housing stability for tenants living in private rental housing. Those registered as rental business operators must lease the property for rental purposes for up to 8 years and cannot increase rent by more than 5%. In return, they receive various tax benefits, including comprehensive real estate tax, acquisition tax, property tax, and capital gains tax.

However, the industry has long criticized that many rental business operators receive all benefits while failing to properly fulfill their obligations to protect tenants. Accordingly, based on data secured during this year's voluntary reporting period and registered rental information, the government will begin full-scale joint inspections starting next month.

The inspection targets are registered rental housing owned by individual rental business operators as of the end of last month. Properties automatically or voluntarily deregistered due to recent system reforms are also included. The inspection scope is limited to the past five years, considering the statute of limitations for fines.

The inspection period runs from next month through December. All 229 cities, counties, and districts nationwide will conduct inspections simultaneously, with focused management of inspection status in collaboration with local governments in areas like Seoul, where housing prices have recently surged significantly.

The Ministry of Land explained, "Inspection items cover the operator's overall public obligations," and "We plan to focus on key obligations such as compliance with the rental obligation period, rent increase limits, and rental contract reporting."

If violations of the rental obligation period or rent increase limits are found, fines of up to 30 million KRW will be imposed, and tax benefits will be reclaimed. Depending on local government judgment, deregistration is also possible.

Currently, violations of rental contract reporting incur fines of up to 10 million KRW only, but if the reporting obligation is evaded due to serious violations such as rent increase limits, system improvements are underway to allow deregistration.

Those who reported during the voluntary reporting period in the first half of the year or actively participate in submitting evidence and face-to-face investigations during suspected violation investigations can receive up to a 50% reduction in fines. Conversely, those who do not cooperate with investigations or are judged to have committed serious violations may face aggravated penalties.

A Ministry of Land official emphasized, "The government will continue to actively pursue various policies to strengthen post-management of registered rental business operators and tenant protection."

This content was produced with the assistance of AI translation services.