House prices have been declining lately.
Due to this influence, I have read many articles that the number of 'reduced renewal contracts', which lower the amount of jeonse and monthly rent compared to existing contracts, is rapidly increasing when renewing a lease contract.
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, and found that 13.1% of the renewal contracts were reduced contracts in the fourth quarter of last year.
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 cheaper price than the previous contract.
It is said that some landlords are unable to return the difference in the deposit, so they pay the tenant monthly rent or support the tenant with interest on the deposit.