Ruling Party and Government "Promote Special Law on Jeonse Fraud... Guarantee Tenants' Housing Rights" (Comprehensive)

Right of First Refusal · Choice Between LH Purchase and Lease
Priority Right Granted for Tenants Wishing to Bid, Tax Reduction
If Lease Desired, LH Purchases and Converts to Public Rental

The People Power Party and the government have decided to prioritize the enactment of a special law that includes granting purchase priority rights and providing loans when bidding on leased housing, in order to support victims of jeonse fraud.

On the 23rd, Park Dae-chul, Chairman of the Policy Committee of the People Power Party, Won Hee-ryong, Minister of Land, Infrastructure and Transport, Han Dong-hoon, Minister of Justice, and Kim Ju-hyun, Chairman of the Financial Services Commission, held a press conference at the National Assembly. Chairman Park stated, "The People Power Party and the government have agreed today through party-government consultations to promote the enactment of a special law to support victims of jeonse fraud and ensure housing stability," adding, "This law is a temporary measure aimed at recovering from disaster-level damages caused by the previous administration's housing policy failures," and "We will prepare government-wide support measures to alleviate the difficulties faced by those suffering from jeonse fraud due to the disastrous surge in housing prices, and include these in the special law."

Earlier, the People Power Party, the government, and the Presidential Office held a meeting at 2 p.m. at the Prime Minister's official residence in Samcheong-dong, Seoul, to discuss countermeasures against jeonse fraud.

Chairman Park explained, "Through the special law, we will guarantee the housing rights of affected tenants," and added, "We will grant purchase priority rights to those who wish to acquire the leased housing they currently reside in, enabling them to own their homes." He continued, "When bidding on leased housing, related taxes will be reduced, and loans will be provided to cover any shortfall in bidding capacity."

He further stated, "For those who wish to continue living as tenants, public entities such as the Korea Land and Housing Corporation (LH) will exercise the purchase priority rights on their behalf, purchase the relevant housing, and provide it as public rental housing," adding, "This will allow victims to live for a long time at affordable rates without worrying about eviction."

Additionally, separate measures to eradicate jeonse fraud will also be pursued. Chairman Park said, "Along with the enactment of the special law, we will intensify efforts to root out jeonse fraud," and added, "We will swiftly and strictly investigate not only landlords but also the behind-the-scenes forces, and push for amendments to the Act on the Aggravated Punishment of Specific Economic Crimes to impose heavier penalties on large-scale property crimes targeting many ordinary citizens, including jeonse fraud."

[Image source=Yonhap News]

Chairman Park criticized the opposition party's proposed public purchase plan, saying, "The public purchase advocated by the opposition is a method where the state directly supports the victims' deposits with taxpayers' money," and added, "It is essentially a deposit national payment law, which involves enormous public funds and ultimately shifts the burden onto all citizens, making it populism and an irresponsible idea." He explained, "The opposition's approach is taxpayer-funded compensation for damages, whereas the party-government's support method guarantees housing for affected tenants," and "The party and government will do their best to help victims return to a stable daily life as soon as possible through responsible and feasible support measures."

The biggest difference between the government’s proposed bill and the opposition’s proposal lies in the purchase of jeonse deposit claims.

Minister Won said, "The opposition's proposal is to return the deposit with public funds even though the amount to be recovered from the deposit claim is effectively zero, and if there is a loss on this money, the state bears it," adding, "This involves astronomical budgets and raises the fundamental question of whether the public agrees." He explained, "The government's plan does not touch the deposit claims; when an auction proceeds, a third party acquires ownership of the property and the landlord enters, evicting the current tenant. We will give the victims the first opportunity to acquire the property, provide low-interest loans, and for those who do not want additional loans, allow them to live under public rental housing conditions." Minister Won added, "The opposition's plan requires returning the property to a general landlord if it does not go to auction, but the government's plan is to acquire the fraud-affected property through auction," and "The opposition's plan to pay the deposit with taxpayers' money using new funds is fundamentally different from ours."

He also explained that no additional funding will be required in this process. Minister Won said, "LH's planned purchase of rental housing this year amounts to 7.5 trillion won," and added, "It is not yet decided which houses will be purchased, but we plan to secure this volume through auctions."

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