"Preventing Jeonse Fraud" Villa Tenants' Jeonse Deposit Guarantee Limit Reduced from the 15th

The 'transaction cliff' phenomenon in the housing market is intensifying due to the burden of soaring house prices and the impact of loan regulations by financial authorities. Although the peak moving season in autumn has officially started after Chuseok, the number of sales transactions is sharply declining as fewer people are willing to buy houses. The photo shows listings posted at a real estate agency in Seoul on the 19th. Photo by Hyunmin Kim kimhyun81@

[Asia Economy Reporter Jo Gang-wook] From the 15th of this month, the jeonse deposit guarantee limit for tenants of row houses and multi-family houses (villas) will be reduced.

According to the Housing and Urban Guarantee Corporation (HUG) on the 5th, starting from the 15th, HUG will change the housing price calculation standard for determining the jeonse guarantee limit of row houses and multi-family houses from the previous transaction price to the publicly announced price.

Unlike apartments and officetels, where the KB market price is used for housing price calculation, for row houses and multi-family houses, HUG has so far prioritized applying the 'transaction price within the last year' over '150% of the publicly announced price.' However, this has been criticized for being easily exploited for jeonse deposit fraud.

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In fact, if the jeonse price is higher than the transaction price, it is impossible to subscribe to jeonse deposit insurance. Nevertheless, there have been cases where the transaction price on the contract was inflated higher than the actual transaction price, deceiving tenants into subscribing to HUG's jeonse deposit insurance and embezzling their deposits.

If HUG prioritizes the publicly announced price over the actual transaction price to calculate housing prices, the jeonse deposit guarantee limit for villa tenants is expected to decrease in practice.

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