"Priority Apartment Allocation? Don't Be Misled" Yongin City Ramps Up Efforts to Prevent Private Rental Housing Scams

Yongin Special City in Gyeonggi Province has recently urged citizens to exercise particular caution regarding investments in "private rental housing projects" that are soliciting investments despite not having finalized business plans.

Yongin Special City conducted a promotional campaign to caution about investment in private rental housing projects. The photo shows a promotional banner hung in front of the Guseong-dong Community Center in Giheung District. Provided by Yongin City

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Recently, there have been frequent cases in certain areas of Yongin City where investors are being recruited with promises such as "future priority allocation of apartments" and "high capital gains upon finalization." The issue is that many of these solicitations are not official "tenant recruitment" but rather take the ambiguous form of "membership in unofficial organizations," which lack clear legal grounds.

According to current law, private rental housing projects must obtain business plan approval and go through an official recruitment announcement process in accordance with the Housing Act or the Special Act on Private Rental Housing. However, it has been found that some promotion centers are soliciting investments even though the approval process has not started or land acquisition has not even been completed.

In such cases, these schemes cannot be recognized as legal sales or tenant recruitment under the law, so there are no clear standards for contract termination or return of investment funds. Furthermore, due to their structural limitations, they are not eligible for protection by administrative agencies, requiring investors to be especially cautious.

There are concerns that if the project is delayed or canceled, investors may be unable to recover their funds, which could directly result in financial losses for citizens.

Yongin Special City conducted a promotional campaign to caution about investments in private rental housing projects. The photo shows the promotional banner hung at Mabuk 2-gyo in Mabuk-dong, Giheung-gu. Provided by Yongin City

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The city is making every effort to prevent the spread of damages, particularly focusing on the Guseong-dong area in Giheung-gu and the Jukjeon-dong area in Suji-gu, which have been identified as potential project sites.

Yongin City is especially concentrating its efforts on preventing the spread of damages in Guseong-dong, Giheung-gu, and Jukjeon-dong, Suji-gu, which are being discussed as potential project sites.

Yongin City has put up warning banners in these areas to ensure that citizens are aware of the seriousness of the situation and posted a "Private Rental Housing Damage Prevention Notice" on the city's website. In addition, the city is distributing informational materials, created based on an analysis of actual damage cases, to further raise practical awareness.

Real estate experts advise, "Investment solicitations that occur before business plan approval often lack legal safeguards," and recommend that "before making any payments for business operation expenses or membership fees, one should thoroughly examine the contract structure."

Yongin Special City conducted a publicity campaign to caution investments in private rental housing projects. The photo shows a promotional banner hung on Mabukgyo Bridge in Mabuk-dong, Giheung-gu. Provided by Yongin City.

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An official from Yongin City stated, "Before signing any investment or membership contract related to private rental housing, it is essential to check whether the business plan has been approved, the percentage of land secured, and the credibility of the developer and related parties." The official added, "The city will continue monitoring and promotional activities to prevent citizens from suffering damages due to illegal private rental housing projects."

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