The Core Is Whether the Deposit Is Returned... Differences Between Ruling and Opposition Parties on Public Purchase Solutions for Jeonse Fraud

Additional Budget Drafting and Other Issues
Ruling and Opposition Parties Show Strong Will to Enact Law
Awaiting Outcome of Plenary Session on 27th

Following the opposition party, the People Power Party and the government have decided to prepare a special law to support victims of jeonse fraud, increasing the likelihood of the enactment of the special law. Although significant gaps between the ruling and opposition parties have been narrowed regarding the protection of housing rights for victims of jeonse fraud through legislation and government-led public purchase initiatives, there remain substantial disagreements between the parties on issues such as the return of jeonse deposits and the allocation of supplementary budgets.

On the 24th, Yoon Jae-ok, floor leader of the People Power Party, said at the party's Supreme Council meeting held at the National Assembly regarding the special law discussed in the party-government consultation the day before, "I believe this is the most practical measure to protect the housing rights of victims by giving those who want to purchase the leased house an opportunity to own a home and allowing long-term residence if they wish to continue living there." He added, "Considering fairness and the feasibility of securing funds, I hope both parties will engage in responsible consultations." He continued, "Above all, since the time given to the victims is limited, I ask for cooperation so that the legislation can be finalized in the National Assembly within this week."

[Image source=Yonhap News]

Earlier, the People Power Party, the government, and the Presidential Office agreed through a high-level party-government consultation to create a special law to support victims of jeonse fraud. The core of the party-government's measures focuses on enabling victims of jeonse fraud to continue living in their current homes without being evicted. The plan involves transferring the house through auction, but allowing tenants to exercise the right of first refusal by receiving financial loan support to acquire ownership, or if they do not wish to purchase, having the LH Corporation exercise the right of first refusal on their behalf to purchase the property and then rent it to the tenant as public rental housing at a price lower than the market rate. However, the government's solution does not include separate guarantees for the jeonse deposit.

The opposition party evaluates that the government's decision to shift toward enacting a special law is commendable, but additional discussions are necessary regarding the return of jeonse deposits. Kim Seong-ju, senior deputy floor leader of the Democratic Party, told this publication in a phone interview, "We appreciate that the government accepted the public purchase proposed by the opposition," but added, "When visiting the field and meeting tenant representatives, the majority want to leave their current residences. Most opinions are simply to protect the jeonse deposits well."

The Democratic Party views the proposal by Assemblyman Jo O-seop, which involves purchasing jeonse deposit claims through the Korea Asset Management Corporation and then providing public rental housing, as a solution to jeonse fraud. Shim Sang-jung, a Justice Party lawmaker who proposed the 'Special Act for the Protection of Tenants of Rental Houses with Unreturned Deposit Guarantees,' also stated in a comment that day, "Additional measures to support victims must be prepared," and emphasized, "A preemptive relief followed by recovery through the purchase of deposit return claims is necessary."

Regarding the purchase of jeonse deposit claims, Deputy Floor Leader Kim said, "There is a valid concern that if taxpayers' money is used to rescue victims of jeonse fraud, what will happen if such fraud occurs again in the future?" He added, "I think it is necessary to specify in detail the targets and scope of claim purchases." The government opposes the purchase of jeonse deposit claims, citing the need for fiscal input and fairness.

The issue of supplementary budget allocation is also contentious. The government and ruling party plan to use this year's LH budget for purchased rental housing to address the jeonse fraud measures. The opposition party is concerned whether this budget will be sufficient and worries about the impact on vulnerable low-income groups. Deputy Floor Leader Kim pointed out, "Currently, the target households number 30,000, but the expected number of affected households could exceed 120,000. Additional funds will be needed, and this must be examined." A Justice Party lawmaker's office official said, "LH's purchased rental housing was originally intended for vulnerable groups, but if the policy changes, vulnerable groups may be pushed down the priority list," and argued, "Additional budget allocation is necessary."

The decision on whether to process the bill at the plenary session on the 27th also remains to be seen. Although Floor Leader Yoon set the goal of processing it this week, with only three days left until the plenary session, the bill has yet to be introduced.

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