In Seoul's apartment market, the demand for rentals in the 60-85 square meter range, popular among families of three to four, has surged, leading to a significant increase in the proportion of contracts with deposits exceeding 700 million won. As more contracts meet or exceed the thresholds for major public rental loans and guarantees, concerns are growing about the financial burden on middle-class renters.
According to the Ministry of Land, Infrastructure and Transport's real transaction disclosure system, as of July 22, 2026, 41.4% of rental transactions for apartments in the 60-85 square meter range reported this year had deposits of 700 million won or more. This marks a 9.2 percentage point increase from 32.2% in the first half of last year.
The trend of rentals exceeding 700 million won is spreading beyond the affluent Gangnam area to mid-range and outer districts of Seoul. Areas that previously saw many transactions in the 500-600 million won range are now experiencing a rise in contracts priced between 700 million and 800 million won, indicating a shift in the baseline for rental prices. This change is attributed to a combination of factors, including a shortage of available apartments, a decrease in rental listings, and rising sales prices that have driven up deposits.
By district, the proportion of rentals over 700 million won in Dongdaemun-gu jumped from 13.2% in the first half of last year to 37.2% this year, with the number of transactions increasing from 188 to 287 during the same period.
In Dongjak-gu, the figure rose from 41.4% to 58.3%, while in Songpa-gu, it increased from 45.5% to 62.2%. Seongdong-gu saw an increase from 49.7% to 65.7%. Both Seodaemun-gu and Gangdong-gu also surpassed the 40% mark, and Seongbuk-gu rose from 6.6% to 20.8%, indicating a clear upward trend even in the outskirts of Seoul.
For instance, in Dongdaemun-gu's Jang-an-dong, a new rental contract for an 84.78 square meter unit at Jang-an Hyundai Home Town was signed for 750 million won on July 13, setting a new record for that size. This represents a 100 million won increase from a similar contract signed in April for 650 million won. A renewal contract in the same month also saw an increase from a previous deposit of 540 million won to 630 million won.
A representative from a local real estate agency in Dongdaemun-gu noted, "While it is true that the influx of new large-scale developments in nearby areas like Imun and Hwikyung New Town has contributed to rising prices, even considering this, properties with deposits several million won higher than last year are being quickly absorbed."
The issue is that 700 million won has become a critical threshold for middle-class renters seeking access to public rental financing. The Korea Housing Guarantee Corporation (HUG) requires that rental deposits in the metropolitan area be below 700 million won to qualify for its main rental loan and guarantee products. Similarly, the Korea Housing Finance Corporation (HF) sets the same limit for its general and group rental deposit guarantees.
Once deposits exceed 700 million won, renters face challenges in utilizing these public guarantee products. They may need to rely on private guarantees, increase their own capital contributions, downsize their living space, or consider switching to guaranteed monthly rent options.
Experts warn that if rental prices for mid-sized apartments continue to exceed public guarantee limits, it could push middle-class renters toward smaller living spaces and a shift to monthly rentals. The increase in the proportion of transactions over 700 million won signifies that the baseline for housing costs that family units must bear is rising.
Kim In-man, head of Kim In-man Real Estate Economic Research Institute, stated, "The fact that rental prices in the most sought-after segments are beginning to exceed public guarantee limits signals that the government's rental financing safety net is out of sync with market prices. To normalize both the rental and sales markets, it is essential to lower the barriers for loans for households without homes that are seeking to reside in these areas."
* This article has been translated by AI.
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