Concerns have been raised that stricter regulations on multiple homeowners could exacerbate instability in the jeonse market. Demand suppression measures aimed at stabilizing the sales market may lead to a reduction in rental housing supply, potentially increasing pressure on jeonse prices.
According to the Korea Construction Policy Research Institute on May 10, the domestic housing market exhibits a supply structure centered around the metropolitan area, a focus on apartment-type housing, and a significant imbalance in supply and demand characterized by high volatility in supply levels.
Go Ha-hee, a deputy researcher at the institute, noted, "While 46.7% of all housing is concentrated in the metropolitan area, the housing supply rate in this region is only 97.3%. In contrast, the supply rate in non-metropolitan areas is 108.4%."
With housing demand concentrated in the metropolitan area, stricter regulations on multiple homeowners could have a significant impact on the rental market. Although some homes owned by multiple homeowners may enter the sales market, a decrease in homes previously used for rental purposes could lead to a reduction in jeonse supply.
Lee Eun-hyung, a researcher at the institute, also commented on the implications of tightening regulations on multiple homeowners, stating, "We are witnessing a simultaneous decrease in rental market listings and rental demand. If we assume that all housing across the country is the same and that supply and demand are always constant, we risk creating a disconnect with the actual market."
The jeonse market is particularly sensitive to regional supply and demand differences. In areas like the metropolitan region, where housing demand is high, a reduction in rental listings can quickly lead to price instability. Go emphasized that the current housing supply issue has a structural nature that cannot be resolved through short-term market responses.
Industry experts suggest that it is difficult to separate the stability of the sales market from that of the rental market. While regulations on multiple homeowners may effectively suppress sales demand, weakening the foundation of rental supply could negatively impact the jeonse market.
Experts advise that to stabilize the jeonse market, regulations on multiple homeowners and supply policies should be coordinated. They stress the need for long-term improvements in the supply structure, such as alleviating concentration in the metropolitan area, exploring diverse housing types, and managing stable supply, rather than merely responding to short-term price fluctuations.
* This article has been translated by AI.
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