Young People Say "I'd Rather Rent Monthly"... Surge in Inquiries About Youth Monthly Rent Support Program

Community Center "More Inquiries About Monthly Rent Support Program Than Last Year"
Youths "Support Program Helpful but Temporary, Regrettable"

Photo by Jinhyung Kang aymsdream@

[Asia Economy Reporter Hwang Seoyul] #Freelancer Lee Seonhwa (25) recently received a text message stating that the interest rate on her jeonse loan had increased by 0.53 percentage points compared to six months ago, and she is now looking into the youth monthly rent support program. Having borrowed 72 million KRW out of an 80 million KRW jeonse deposit, she has to pay an additional 380,000 KRW annually due to the interest rate hike. Preparing to move, Lee said, “If the interest rate rises further, switching to monthly rent and receiving rent support would be better both in terms of available properties and costs.”

As more young people consider switching to monthly rent due to rising jeonse loan interest rates and a shortage of jeonse listings, inquiries about government and local government monthly rent support programs are also increasing.

According to the Seoul Real Estate Information Plaza on the 20th, last month the proportion of monthly rent transactions among jeonse and monthly rent deals in single-family and multi-family houses, where many young people reside, increased by 1.8 percentage points from the previous year to 59.9%. Multi-unit and row houses also saw an increase of 1.7 percentage points to 26.5%. Staff at community centers located near university areas such as Gwanak-gu and Dongdaemun-gu in Seoul unanimously reported, “Inquiries about monthly rent support programs have increased compared to last year.”

With the growing number of young people paying monthly rent, the Ministry of Land, Infrastructure and Transport plans to introduce the 'Youth Monthly Rent Temporary Special Support Program' in April this year to assist young people with housing costs. The Ministry’s monthly rent support program has different eligibility criteria compared to local governments. For example, Seoul’s 'Youth Monthly Rent Support Program' targets young people with an individual median income of 150% or less, while the Ministry’s program supports young people with an individual median income of 60% or less. A Ministry official stated, “We aim to support housing costs for more young people by distinguishing income criteria and coverage areas between local government and central government monthly rent support programs.”

Photo by Jinhyung Kang aymsdream@

Youth have praised the monthly rent support programs for helping reduce housing cost burdens but expressed regret that the programs are temporary. A survey of young people selected for Seoul’s youth monthly rent support program in 2020 showed that when asked about their plans to cover rent after the program ended, 40.1% said they would reduce living expenses or savings, and 17.0% said they would start part-time jobs. Kim Seunggon (25), who participated in last year’s Seoul monthly rent support program, also said, “It’s true that the rent support program eased my housing cost burden,” but added, “After the support ends, I plan to return to my parents’ home to prepare for employment in order to reduce housing costs.”

Professor Lim Jaeman of the Department of Real Estate at Sejong University said, “Young households are low-income households, so once monthly rent support ends, housing cost burdens inevitably return,” and added, “There is a need to establish long-term support measures for young people who do not exceed the median income criteria.” He further noted, “Given budget constraints, gradually extending the support period could be a practical approach.”

The Ministry of Land, Infrastructure and Transport will provide up to 200,000 KRW per month for 12 months through the ‘Youth Monthly Rent Temporary Special Support Program’ starting in April this year to young people with an individual median income of 60% or less and a household median income including parents of 100% or less. Detailed guidelines will be announced.

Seoul City plans to support eligible young people with up to 200,000 KRW per month for 10 months through the ‘Youth Monthly Rent Support Program’ within this year. Young people living in housing with a deposit of 50 million KRW or less and monthly rent of 500,000 KRW or less, and whose household median income per household member is 150% or less, can apply for the program. Last year, other cities and provinces provided support ranging from 100,000 to 200,000 KRW depending on the local government.

Government and local government programs cannot be applied for simultaneously, and support can only be received once in a lifetime.

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