A man checks rental listings in Seoul on Monday, where monthly leases are now more common than "jeonse" deposit contracts amid rising financial risks. (Newsis)
A man checks rental listings in Seoul on Monday, where monthly leases are now more common than "jeonse" deposit contracts amid rising financial risks. (Newsis)

Monthly rental contracts now make up nearly 65 percent of all new housing leases in Seoul, reaching a record high as South Korea’s traditional lump-sum rental system, "jeonse," continues to disappear.

In the first quarter of 2025, monthly rentals accounted for a record 64.6 percent of Seoul’s housing leases, accelerating a major shift as both tenants and landlords increasingly turn away from the lump-sum jeonse model amid rising financial risks. (Supreme Court's Integrated Registration Information System)
In the first quarter of 2025, monthly rentals accounted for a record 64.6 percent of Seoul’s housing leases, accelerating a major shift as both tenants and landlords increasingly turn away from the lump-sum jeonse model amid rising financial risks. (Supreme Court's Integrated Registration Information System)

According to the latest data by the Supreme Court’s Integrated Registration Information System, Seoul registered 233,958 residential lease contracts between January and March this year. Of those, 151,095 — roughly 64.6 percent — were monthly rental deals, the highest share since data collection began in 2014.

Jeonse is a system unique to South Korea where tenants pay a large upfront deposit instead of monthly rent, usually recovering the full amount at the end of the lease. But confidence in this system was deeply shaken after a series of fraud cases in 2022 aimed at swindling tenants’ deposits. More than 40,000 cases of jeonse fraud claims have been reported since June 2023.

The shift away from jeonse was first mainly in nonapartment properties such as villas, but market data shows it is now increasingly affecting apartments, the mainstay of Korean housing, as well.

In 2021, monthly rentals made up just over 40 percent of total home leases. That climbed to nearly 60 percent by 2023, and crossed into the mid-60 percent range this year. Tightened eligibility rules for deposit insurance, meant to protect tenants, have also nudged landlords to prefer monthly rents over high-risk jeonse deposits. Since May 2023, only homes with deposits up to 126 percent of the government-assessed value qualify for insurance, down from 150 percent.

As for apartment homes, an analysis by Woori Bank’s WM Sales Strategy Department showed that nationwide, 44.2 percent of lease contracts in January and February were monthly rentals — up from 42.2 percent in 2024. In Seoul, monthly contracts for apartments reached 51.1 percent, surpassing jeonse for the first time.

Higher jeonse prices and still-elevated interest rates on housing loans are also pushing many renters to favor monthly payments. Seoul’s apartment jeonse prices have risen for 12 straight weeks, according to the Korea Real Estate Board, with no signs of cooling.


mjh@heraldcorp.com