Navigating the Jeonse Shortage: Experts Urge for Improved Infrastructure and Lending as Non-Apartment Housing Parking Regulations Relax [Real Estate AtoZ] – The Asia Business Daily

The demand for non-apartment housing in Seoul is on the rise as the availability of apartment jeonse units declines and monthly rents soar. To tackle this issue, the government plans to provide 110,000 non-apartment units in the metropolitan area by 2030. This includes urban lifestyle homes and converting vacant commercial spaces into studio apartments and officetels.

However, there are concerns about public trust after recent scams involving jeonse deposits. Many fear that easing regulations on parking spaces and communal facilities could lead to a repeat of past problems where living quality suffered. For example, during the Lee Myung-bak administration, rapid developments led to serious parking shortages and inadequate living spaces.

The government aims to issue 77,000 permits for urban lifestyle homes by 2030 and convert over 33,000 vacant commercial spaces. They are temporarily easing rules around the number of units and parking to speed up this process, but local officials warn that simply adding more units won’t guarantee better living conditions.

Recent data shows a significant shift in the rental market. Monthly rentals accounted for over 50% of all transactions in early 2023, up from the high 30s just a year ago. This suggests more people are turning to non-apartment options due to skyrocketing rents but are now wary due to the fraud scandals. The number of permits for non-apartment buildings has plummeted from about 226,000 in 2015 to just 33,000 last year.

Experts emphasize that fixing the issues with non-apartment units requires more than just increasing supply. Improvements in lending practices and better living infrastructures—like parking, parks, and daycare centers—are essential. Without these, simply adding more units could lead back to the same quality problems seen before.

In conclusion, while the government’s plan to boost non-apartment housing is a step in the right direction, restoring public confidence and ensuring living standards must be prioritized. Otherwise, the solutions may only lead to greater challenges in the future.

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