The South Korean government has introduced a comprehensive policy to prevent jeonse (long-term deposit rental) fraud, following a rise in tenant victimization. The new measures focus on providing integrated risk information and shifting the policy paradigm from post-incident relief to proactive prevention. By addressing information asymmetry between landlords and tenants, the government aims to create a more transparent and secure rental environment. The initiative is a collaborative effort among several ministries, including the Ministry of Land, Infrastructure and Transport, the Ministry of Justice, and the Financial Services Commission.
These measures directly impact prospective tenants, landlords, and real estate agents. Prospective tenants will now be able to access consolidated information on prior claims, registration status, confirmed dates, household registrations, and tax arrears before signing a contract. Landlords will face stricter scrutiny, and real estate agents will have increased obligations to verify and explain risk information using the new integrated system. The changes are designed to help tenants avoid risky contracts and prevent landlords from exploiting legal loopholes.
The policy will be implemented in stages, with a major digital service upgrade to the ‘Safe Jeonse App’ by September 2024. Even before legal amendments are finalized, a public service requiring landlord consent will be available from September. The timing for tenant rights (opposability) will be changed to take effect immediately upon moving in and registering, closing a loophole previously exploited by some landlords. Financial systems will also be linked to prevent duplicate loans based on overlapping deposit claims.
Frequently asked questions include: How will tenants access risk information? Tenants can use the upgraded Safe Jeonse App to view all relevant risk data in one place before signing a contract. What are the new responsibilities for real estate agents? Agents must now verify and explain integrated risk information to tenants and face higher penalties for non-compliance. When will these changes take effect? The main digital service and related measures will begin rolling out in September 2024.
These policy changes mark a proactive and comprehensive approach to tackling jeonse rental fraud in South Korea. By integrating risk information from multiple agencies and making it easily accessible to tenants, the government is addressing key vulnerabilities in the rental process. The immediate activation of tenant rights and stricter obligations for real estate agents further strengthen tenant protection. This coordinated effort, if implemented effectively, could significantly reduce fraud and enhance trust in the rental market.