Seoul's 5 per cent renewal cap splits one officetel into two prices 192 million won apart

Work backwards from the cap and the two prices at Hyundai Hyperion II in Mok-dong resolve into one price and a lag. The renewal right holds a deposit increase to 5 per cent of the existing rent ^[7], so a renewal struck at 1.008 billion won implies a prior deposit of 960 million, because 960 times 1.05 is 1.008 ^[18]. The tenant who signed a new contract on the same 94-square-meter layout in July paid 1.2 billion, or 192 million won more ^[6][17].

At Sinnae Station Pradium the Terrace in Mangu-dong the same reversal gives 430 million as the deposit behind a 451.5 million renewal, against 560 million on a July new contract ^[9][19]. That is 130 million won, 30.2 per cent, to move house within the same complex ^[19].

Supply on the ground explains why the new-contract leg clears at all. Seoul Economic Daily reports that the Sinnae complex has close to 1,000 units and one jeonse listing, which cannot be transacted because no move-out date has been set, while several prospective tenants wait ^[10]. "Only renewal contracts are being signed in the 400 million won range, and it is now hard to find anything below 550 million won," an official at a nearby brokerage said ^[11]. The same official said: "As jeonse deposits at nearby apartments pass 600 million won, demand is crowding into officetel jeonse" ^[12].

The aggregate is milder than any of that. KB's average of 237.37 million won is a record for a series that starts in January 2011 ^[1], and the year-to-date increases behind it are 3.08 per cent for mid-sized units at 472.36 million and 1.66 per cent for large units at 816.89 million ^[2][3]. Both sit inside the 5 per cent cap. Individual prints do not: Gusan Dream Tower's 85-square-meter jeonse went from 500 million won last December to 600 million in July, 20 per cent in about six months and back to its 2022 peak ^[13][21], and a 78-square-meter unit at Yeouido the Sharp Island Park added 90 million to reach 820 million, 12.3 per cent ^[14][22].

Part of the reason the index looks calm is composition. The mid-sized average of 472.36 million won is 1.99 times the all-officetel average of 237.37 million ^[20], so the record headline is mostly a studio number, and the family-sized units doing the substituting are priced somewhere else entirely.

The supply side is not ambiguous. Budongsan114 counts 1,700 Seoul officetel move-ins this year against 4,122 last year, 2,422 fewer units ^[5][23], and brokers attribute part of the drop in lease listings to owner-occupancy policy: apartment owners move into their own units, tenants who rented apartments while owning officetels relocate into those officetels, and the listing never appears ^[15].

Two resolutions are worth separating. If new-contract prices stall, the 192 million won spread closes from above and the mid-size index rolls over rather than compounding; if renewal rights are exhausted before that, the deferred step-up lands in single contracts and the average catches up to the marginal price. The read that the shortage will run for years ^[16] fails if this year's 1,700 move-ins are a completion-timing artifact and next year's schedule restores the units.