March 29, 2024Open Access

Strategies for Stabilizing the JEONSE Market to Establish Order in Real Estate Transactions

Key Points

JEONSE incidents have escalated, driven by financial risks and institutional weaknesses, impacting tenants' lease deposits.
In the years 2017 to 2022, a notable increase in JEONSE fraud and guarantee mishaps was observed, harming many tenants.
This research recommends improving information transparency and transaction security through better property data sharing by lessors and independent checks by tenants, including defensive contracts for protection against incidents. The aims involve stabilizing the JEONSE market for the benefit of genuine victims and fostering a reliable transaction environment.

Abstract

The traditional lease system based on deposit in South Korea, integral to the residential life of the populace, is facing instability.Recent instances where tenants have not received partial or full lease deposits back from landlords have escalated into a significant social issue.This study delves into the causes of JEONSE incidents, examining institutional, temporal, and regional factors from 2017 to 2022.It was found that a blend of escalating financial and real estate policy risks, coupled with institutional frailties, have precipitated various JEONSE -related accidents.These incidents encompass reverse JEONSE, high-risk JEONSE, JEONSE fraud, and JEONSE guarantee mishaps, with the damage from such incidents increasing annually.To stabilize the JEONSE market, this research proposes multifaceted solutions encompassing lessors, tenants, and institutional measures.For lessors, it recommends providing comprehensive property and financial information during brokerage, such as national and local tax payment records and priority bonds, to address information asymmetry and enhance transaction security.For tenants, it advises verifying property values, JEONSE rates, and landlord information independently or through real estate experts.Additionally, tenants should limit lease loans to necessary amounts to mitigate financial risks and proactively engage in drafting defensive contracts.Early prevention via defensive contracts is crucial for tenants to avoid JEONSE incidents.From an institutional standpoint, this study suggests expanding the supply of JEONSE housing, addressing landlord information asymmetry, and developing explanatory manuals for verifying premises' JEONSE price ratios.By enhancing the stability of the JEONSE market and fostering an alternative transaction order, this study aims to shield bona fide victims from JEONSE related adversities.

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