Invest1 publisher2 min readPublished
Gangil-dong's public tenants face a 337 million won gap to Seoul's average jeonse
Seoul will hold 20-year public-housing tenants to their move-out dates from 2027 as the average apartment jeonse reaches a record 636.63 million won. Each exit is meant to free a unit for a waiting-list family, so the policy mostly changes which households chase Seoul's thinning listings.
The Investor · Invest desk
What happened
- Seoul's average apartment jeonse price reached a record 636.63 million won, passing the 634.24 million won peak of January 2022, according to the Korea Real Estate Board.
- Seoul apartments available for jeonse fell from 50,011 in February 2023 to 19,242 in February 2026.
- The Seoul Metropolitan Government says long-term public rental tenants will move out when their 20-year contracts mature, under the original contract terms.
- Gangil-dong tenants want renewals at 80% of market value for those still without homes, and the right for 20-year residents to buy their units at appraised value.
- In a city survey of 1,000 residents, 73.9% agreed with the principle of moving out after the 20-year term.
Compiled by The InvestorSomething wrong?How this is made
Why it matters
- cost A Gangil-dong household leaving with its 300 million won deposit would need about 337 million won more to rent an average Seoul apartment on jeonse, and it bears that gap alone.
- decision Choosing exits over renewals decides which family competes for private listings, because each exit is meant to move a waiting-list household into the vacated unit.
- constraint Letting 20-year tenants buy at appraised value would permanently shrink a public stock that is about twice Seoul's current apartment jeonse listings.
"We settled in Gangil-dong trusting the city, which promised 20 years of stable housing at a deposit worth 23% of market value," the residents said. "But once contracts start maturing in 2027, we have to leave homes now worth 1 billion won with only our 300 million won deposit returned." [7] The 1 billion won valuation and the 23% are the residents' own figures. Against the average Seoul apartment jeonse of 636.63 million won [2], a 300 million won deposit covers about 47% of a typical lease. That leaves a gap of roughly 337 million won [4].
The market those households would re-enter has thinned faster than it has repriced. Listings are down 61.5% in three years [1]. Korea Real Estate Board figures put the price record only 2.39 million won above the January 2022 peak, about 0.38% [2]. This year's pace is about 4.6 times last year's, 8% against 1.75% over the same weeks [3] [3]. Contracts signed in haste without a proper viewing have become common [5].
I think the exits change who bears the shortage more than they change its size. The city says it refuses extensions to protect openings for non-homeowners on the waiting list [10]. On that basis, each move-out sends one household into the private jeonse market and takes another out of it. A renewal leaves both households where they are. Under either choice the same number of families competes for private listings. The case against that view is timing. If vacated units sit empty for refurbishment or slow re-letting, each exit adds a household to private demand for months before a waiting family leaves it. The report does not say how fast the city re-lets units, or how many of the 38,296 supplied since 2007 [6] mature in 2027.
The public stock is large next to that flow. The 38,296 units are about twice the 19,242 apartments listed for jeonse in February [5]. The ratio is rough, since the listing count covers apartments only [4]. The tenants' two demands [8] treat that stock differently. Renewal at 80% of market value keeps the units public but closes them to the waiting list for another term. Purchase at appraised value would take units out of rotation for good. Critics cited by Sedaily argue that either kind of priority would hand publicly owned housing to a select group [12].
The mayor has chosen rotation. At a Sept. 8 forum, Oh Se-hoon called the extension requests "an unconscionable demand" and said the city "will make no exceptions" [9].
What to watch
- The Korea Real Estate Board's February 2027 count of Seoul apartment jeonse listings, measured against 19,242 a year earlier.
- Whether the city softens its position on sale at appraised value before the first contracts mature in 2027.
- Whether Seoul jeonse prices keep rising at this year's 8% pace into 2027, when the first long-term leases end.