House prices have been declining lately.
Due to this influence, I have seen many articles saying that 'reduction renewal contracts', which lower the amount of jeonse and monthly rent compared to existing contracts when renewing lease contracts, are rapidly increasing.
A real estate brokerage startup analyzed the actual transaction price of jeonse and monthly rent in the metropolitan area of the Ministry of Land, Infrastructure and Transport. As a result, among renewal contracts in the fourth quarter of last year, 13.1% of contracts with reduced prices accounted for.
It is a figure that has increased more than three times compared to the second quarter, and is the highest since 2021, when the Ministry of Land, Infrastructure and Transport released related data.
The rate of renewal at the same amount as the previous contract was also 12.9%.
As the interest rate soared, the demand for jeonse decreased and landlords who could not immediately withdraw the jeonse money because they could not find a tenant renew the contract at a lower price than the previous contract.
It is said that some landlords are unable to return the difference in deposit, so they pay the tenant monthly rent or support the tenant with interest on the deposit.