Lease Cannot Be Terminated Even If Tenant Acquires Pre-Sale Right While Living in Public Rental Housing

Published 13 Oct.2025 15:06(KST)

Updated 13 Oct.2025 16:45(KST)

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Even if a Pre-Sale Right Is Acquired While Living in Public Rental Housing
"Lease Cannot Be Terminated for Tenants Who Moved in Before the Regulation Took Effect"

The Supreme Court has ruled that even if a tenant residing in public rental housing temporarily acquires a pre-sale right, the landlord cannot terminate or refuse to renew the lease contract if the tenant moved in before the enforcement of the revised housing supply regulations, which equate holding a pre-sale right with home ownership.

Yonhap News Agency

On September 11, the Supreme Court's Third Civil Division (Presiding Justice Lee Heungku) overturned the lower court's ruling in favor of Korea Land and Housing Corporation (LH) in the appeal trial (2024Da284418), in which LH had filed a lawsuit against tenant A for the return of the building, and remanded the case to the Changwon District Court.

[Facts]

Since 2006, A had been living in a national rental apartment supplied by LH, renewing the contract every two years. The contract included a clause stating, "If the tenant acquires ownership of another house during the lease period, the contract may be canceled, terminated, or renewal may be refused." During the lease period, in April to May 2021, A acquired an apartment pre-sale right but sold it to a third party in June of the same year. In October 2021, LH notified A that he had been found ineligible for tenancy due to his home ownership record and requested an explanation, followed by an eviction notice.

[Key Issue]

The main issue was the scope of application of Article 53 of the Housing Supply Regulations, which was revised in December 2018. The revised regulation newly stipulated that "if a person owns a pre-sale right, it is regarded as home ownership," and excluded pre-sale right holders from the category of people without homes. However, the supplementary provision stated that "this regulation applies only to cases where an application for approval to recruit tenants is submitted after the enforcement of this regulation."

[Lower Court Rulings]

The first trial ruled in favor of A. The court found that "if a tenant acquires a pre-sale right but disposes of it immediately, this cannot be grounds for terminating the lease contract," citing the Enforcement Decree of the Special Act on Public Housing, which allows an exception if the property is disposed of within six months of acquisition during the lease period.

However, the appellate court sided with LH, stating, "Tenants of public rental housing must maintain the status of not owning a home during the lease period, and acquiring a pre-sale right results in the loss of such status at the time of acquisition." The appellate court also held that even if the lease contract was signed before the revised regulation took effect, the new rules would apply if the pre-sale right was acquired after the revision.

[Supreme Court Decision]

The Supreme Court overturned the appellate court's decision. The Supreme Court held that the revised regulation cannot be retroactively applied to tenants who had already moved into rental housing supplied before the revision. The court stated, "The phrase 'when applying for approval to recruit tenants' in the supplementary provision refers to the point at which the public rental housing provider applies for approval to recruit tenants, not when the tenant acquires a pre-sale right. Interpreting it as the time of pre-sale right acquisition would create a contradiction within the regulatory framework." The court further explained, "In this case, the rental housing received approval for tenant recruitment in 2006, prior to the enforcement of the revised regulation. Therefore, even though the defendant acquired a pre-sale right in 2021, the contract cannot be terminated or renewal refused based on the revised regulation."