Seoul Mayor Oh Se-hoon has urged the government to implement urgent measures to revitalize the private rental market, citing a surge in monthly rents and a decrease in rental listings that have intensified housing insecurity for residents. He believes that the government's binary approach of prioritizing 'actual residence' cannot resolve the issues of housing prices and rental markets. Therefore, he is calling for a comprehensive reassessment of the government's real estate policies.
On September 7, Mayor Oh posted on his Facebook page titled 'Rental Hell: Urgent Measures Needed,' stating, "The entire city of Seoul is becoming a 'housing hell' due to the rental crisis, with cries of despair from those being forced out as rental refugees, unable to live in Seoul any longer."
He noted that the average monthly rent for apartments in Seoul reached a record high of 1.62 million won in July, with rental prices soaring by 9.95%, while the drought of rental listings continues.
While he welcomed the government's consideration of reducing the comprehensive real estate tax burden on corporate rental operators, he criticized it as being too little, too late, stating, "This is far from sufficient to resolve the current rental crisis."
Mayor Oh emphasized that since last year, he has been advocating for the government to recognize rental operators not just as subjects of regulation but as key players in providing stable rental housing. He argues for easing loan regulations for purchase-type rental operators and excluding them from the comprehensive real estate tax.
He also strongly criticized the recent tax reform that abolished tax benefits for registered rental operators. He explained, "There are 407,000 registered private rental units in Seoul, accounting for about 20% of all rental housing, with approximately 93,000 registered rental operators. They have accepted mandatory rental periods and rent increase restrictions in exchange for tax benefits."
He pointed out that the benefits were eliminated in the August 3 tax reform, and private rental apartments that had their mandatory rental periods automatically canceled must be sold by 2027 to maintain existing benefits.
Mayor Oh expressed concern that labeling registered rental operators as speculators and removing tax benefits could lead to some housing moving to the sales market, resulting in a loss of rental housing where tenants can live long-term without worries about rent increases or contract terminations.
He urged the government to reconsider regulations that could destroy the very housing stability they aim to protect, stating that private rental businesses should be institutionalized as a pillar of stable rental housing supply.
Specifically, he proposed establishing a legal definition for 'corporate private rental operators' and clearly defining their support and obligations. He also argued that existing registered rental operators should be utilized as providers of stable rental housing within a predictable regulatory framework.
Mayor Oh questioned, "If the government attracts private supply when needed but reverses promised benefits when policies change, who will trust the government to invest in rental housing again?" He concluded that the fundamental solution to the current rental crisis lies in a complete reassessment of the 'actual residence' focused real estate policy, emphasizing that such a binary approach cannot control housing prices or revive the rental market.
* This article has been translated by AI.
Copyright ⓒ Aju Press All rights reserved.