MoneyLog｜부동산·경제 인사이트

| Prologue: A Neighborhood Without Rentals

These days, saying that both jeonse and monthly rentals have “dried up” no longer feels like an exaggeration.

When I open my office each morning, the phone no longer rings with rental inquiries like it used to. Looking around the neighborhood, there isn’t a single decent rental listing in sight.

Normally, this time of year—right before the new school semester— is when the rental market becomes the most active. Students, young professionals, and newly married couples all start moving at once.

This year feels completely different. There is no movement. No inquiries, no contracts— as if the market itself has come to a halt.

Many of you may be feeling the same confusion. Housing prices have stabilized, so why has it become even harder to find a place to live? Why is jeonse disappearing, and why are even monthly rentals so scarce?

This is not a temporary slowdown. It is a signal that the structure of Korea’s housing market is fundamentally changing.

In this article, we will take a closer look at why jeonse is rapidly disappearing, how the rental market is shifting toward monthly payments, and what both landlords and tenants need to prepare for in this new era.

| ① Interest Rate Shift: The End of “Free Loans”

Jeonse was once an attractive option for landlords. Large deposits functioned almost like interest-free loans.

Landlords could place those deposits in banks or investments, using the interest income to cover holding costs.

Tenants, in return, avoided monthly rent payments. It was a system that benefited both sides.

However, this balance collapsed as interest rates fell.

When base rates dropped to near 1%, the interest earned on large deposits became negligible.

From a landlord’s perspective, jeonse turned into a structure with little return and significant risk.

Monthly rent, on the other hand, offers stable cash flow regardless of interest rate conditions.

The shift from jeonse to monthly rent is therefore not driven by greed, but by economic rationality.

| ② Real Estate as an Investment Asset: Rising Volatility and Risk

Jeonse can only function properly when housing prices remain relatively stable.

In the past, modest and predictable price movements allowed jeonse to serve as a safe housing option.

Today, real estate has become a highly volatile investment asset.

This shift creates serious problems for the jeonse system.

When housing prices fall sharply, landlords may struggle to return large deposits, leading to reverse-jeonse situations.

When prices rise rapidly, landlords have little incentive to maintain jeonse contracts and often switch to monthly rent.

In both scenarios, increased price volatility works against jeonse.

For tenants, jeonse deposits now represent large financial risks. Housing price declines or landlord insolvency can directly threaten deposit recovery.

As jeonse scams and deposit losses have become more common, tenants increasingly view jeonse as a high-risk option rather than a safe one.

In such an environment, choosing monthly rent becomes a rational decision for landlords seeking stable returns.

| ③ Policy Uncertainty and the Collapse of Trust

Another key factor behind the decline of jeonse is the loss of trust in government housing policies.

The rental market depends heavily on predictability because contracts involve large sums and long timeframes.

This trust was seriously damaged by the sudden introduction of the 2+2 lease renewal system.

The issue was not the intention of the policy, but the way it was implemented.

Applying new rules to existing contracts— effectively retroactively—created confusion and conflict between landlords and tenants.

From that moment, long-term jeonse contracts began to feel like a policy risk for landlords.

As a result, many landlords shifted toward shorter contracts, monthly rent, or hybrid structures that allow faster responses to regulatory changes.

While the policy aimed to protect tenants in the short term, it ultimately reduced the supply of jeonse in the long run.

When trust disappears from the rental market, participants choose the most conservative options— and that often means avoiding jeonse altogether.

| The Shadow of a Rent-Driven Society

The disappearance of jeonse represents more than a shift in housing style.

It signals the collapse of one of Korea’s key pathways for asset building.

Young adults and first-time workers are the most affected.

In the past, living under jeonse allowed tenants to save money that would otherwise go toward monthly rent.

As monthly rent becomes the norm, housing costs turn into a permanent obstacle to saving.

Without family support, many are pushed back before they even reach the starting line.

The middle class is not immune either. Jeonse functioned as a safety net for households with stable income but limited assets.

With that safety net gone, non-homeowning middle-class families face growing disadvantages over time.

The deeper issue is that Korea is entering a rent-based society without adequate preparation.

In Europe and the U.S., rental systems are supported by long-term leases, rent controls, public housing, and wage structures that can sustain housing costs.

Korea, however, is moving toward higher rent burdens without these protective mechanisms in place.

The decline of jeonse threatens not only housing stability but also social mobility and long-term economic balance.

| Housing Strategies in the Post-Jeonse Era

In the past, the key question was simply whether to choose jeonse or not.

Today, that framework no longer works. The real question is the total cost and risk of housing.

The first step is calculating total housing expenses.

Instead of focusing only on monthly rent, tenants should consider opportunity costs of deposits, interest losses, management fees, loan interest, and deposit return risks.

In some cases, jeonse may actually be the more expensive option.

The second key factor is liquidity.

Jeonse ties up large sums of money in one place. In a volatile market, this can create significant financial risk.

Maintaining flexible assets outside of housing allows better responses to unexpected changes.

Finally, there is no universal “correct” choice anymore.

The right housing decision now depends on income stability, asset size, and personal risk tolerance.

Housing has become not just a place to live, but a core part of personal asset management.

| Epilogue: Life After Jeonse

The disappearance of jeonse represents more than the loss of a housing system. It signals the quiet exit of an economic structure that once defined everyday life in Korea.

The real issue is not that jeonse is fading away, but that we are not fully prepared for what comes next.

Korea is already moving toward a rent-based society, yet the institutional safeguards for housing stability remain insufficient.

As a result, this transition feels less like a choice and more like a burden imposed by structural change.

For both landlords and tenants, jeonse is no longer an obvious answer.

Reducing risk, calculating total costs, and maintaining liquidity have become essential considerations.

The post-jeonse era offers no universal solutions. Each person must evaluate their own position and make informed decisions.