• Journal of the Korean Regional Science Association
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• v.31 no.2
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• pp.63-77
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• 2015

Effects of shifting trend from Chonsei to monthly-rent and the changes in rental housing prices upon the welfare of tenants has been analyzed. In 2014, welfare of tenants has been found to be decreased by 660 billion Korean Won due to the change in rental housing prices. From the point of view of the welfare of tenants, it has been found that monthly-rent stabilizing policies are 1.47 times more effective than Chonsei price stabilizing policies. The effect of monthly-rent stabilizing policies has been found to be increased with the increase in the proportion of monthly-rent transaction, the decrease in the speed of the shifting trend from Chonsei to monthly-rent, the decrease in interest rate, the decrease in the proportion of variable deposit in monthly-rent, the decrease in the proportion of debt in Chonsei deposit. These findings indicate that the relative importance of monthly-rent stabilizing policies will be increased in the future.

• Journal of the Economic Geographical Society of Korea
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• v.18 no.3
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• pp.348-365
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• 2015

This study empirically analyzes the recent conversion trend of Jeonsei to monthly rental contracts in the APT rental market and its major characteristics for three Gangnam districts using the real transaction Jeonsei and monthly rent prices data over the period of 2010.12 to 2015.4. The results show that in terms of deposits and substitutability the conventional apartment is more efficient than those of the reconstruction apartment. Moreover, monthly rental contracts are closely related with the movement of short-term interest rates. Given the same type of apartment, the result drawn from the substitutability between Jeonsei and monthly rental contracts reveals that the monthly leasing contract with the lower rate of deposit tends to have the higher conversion rate of Jeonsei to monthly rent. Thus, an urgent measure should be taken that the burdens of tenants with monthly rent contracts could be alleviated according to the rate of deposits.

• Land and Housing Review
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• v.14 no.4
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• pp.17-37
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• 2023

The rental housing market in South Korea, specifically monthly rent with deposit, has been expanding over the last three decades (8.2% in 1990 to 21.0% in 2020), partly replacing the traditional Jeonse market. The distribution of rent has changed due to public rental subsidies and the emergence of luxury rental housing, while the distribution of rental household income has been polarized because of the emergence of rich renters. This study attempts to measure the structural changes in the rental market by developing a new indicator of income-rent mismatch. Using the seven series of the Korea Housing Survey, this study analyzed the changes in rent (reflecting the conversion rate) and income levels of rental households in 2006 (base year) and 10-15 years later (the analysis year) at the national level and at the spatial unit of 16 metropolitan cities and provinces (excluding Sejong), respectively, by dividing them into quartile data. The result reveals that rental housing was undersupplied in middle- and high-income rental housing due to the decline in the highest quartile (25%→18%) and the third quartile groups (25%→20%), while the supply of public rental housing expanded for the second quartile (25%→28%) and the lowest quartile (25%→35) groups. On the demand side, the highest income quartile shrank (25%→21%), while the lowest income quartile grew (25%→31%). Comparing the 16 metropolitan cities and provinces, there were significant regional differences in the direction and intensity of changes in rent and renter household income. In particular, the rental market in Seoul was characterized by supply polarization, which led to an imbalance in the income distribution of rental households. The structural changes in the apartment rental market were different from those in the non-apartment rental market. The findings of this study can be used as a basis for future regional rental housing markets. The findings can support securing affordable rental housing stock for each income quartile group on monthly rent and developing housing stability measures for a balance between income and rent distribution in each region.

• KDI Journal of Economic Policy
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• v.45 no.4
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• pp.57-77
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• 2023

The Chonsei component holds the highest level of weight (5.4%) in the composition of the Korean consumer price index (CPI). The variations in Chonsei prices are directly reflected in the CPI as a representation of cost swings. The Chonsei refers to a deposit that accumulates the costs related to housing services and is mostly affected by variations in rental rates. Nevertheless, it is important to note that Chonsei prices are also susceptible to fluctuations in interest rates, regardless of the rent prices. Therefore, if Chonsei were directly and one-to-one indexed to the CPI, they could include changes other than residential service prices. After analyzing the time series data of the Chonsei index and rent index inside the CPI, it becomes apparent that the Chonsei index displays an average annual growth rate of 2.3%, whilst the rent index reveals a growth rate of 0.9%. The observed disparity in growth rates indicates a divergence in trends between the two indices. It is posited that the Chonsei index, when capitalized, has had a more rapid increase compared to the rental index, owing to the gradual drop in interest rates. To effectively reflect fluctuations in the housing service costs, proxies for the Chonsei index were utilized in the construction of a consumer price index. The findings of our study suggest that, overall, the newly developed CPI demonstrates a comparatively lower rate of inflation when compared to the official CPI. Furthermore, the inclusion of imputed rents for owner-occupied housing in CPI amplifies this effect.

• Journal of Cadastre & Land InformatiX
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• v.51 no.2
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• pp.125-139
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• 2021

Continuous subway line expansion over the years in Seoul metropolitan area has contributed to improved accessibility to public transport. Since public transport accessibility has a significant impact on housing decisions, quantitative analysis of correlation between housing prices and public transport accessibility is regarded as one of the most important factors for planning better housing policies. This study defines the reduction of traveling time resulted from the construction of new metro stations despite them not being the closest stations as 'Network Expansion Effect', and seeks to understand how the Network Expansion Effect impacts on housing prices. The study analyzes monthly rent data converted from upfront lump sum deposit, so called Jeonse in Korea, from 2012 to 2018, through 'A Modified Repeat Sales Model.' As a result, the effect of 'Network Expansion' on rental prices in Seoul has stronger during the period of 2017 to 2018 than the base period of 2012 to 2014, which suggests the 'Network Expansion' has a meaningful effect on rent. In addition, in comparison between the most and the least affected group of apartments by 'Network Expansion Effect', the most affected group has more price increase than the least affected group. These findings also indicate that different levels of 'Network Expansion Effect' have various influences on the value of residential real estate properties.

• Land and Housing Review
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• v.13 no.3
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• pp.57-68
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• 2022

This study investigates what influences the 2030 households' intention to utilize housing support policies for the younger generation. Using the logistic regression model, our empirical results show that the 'the recognition of youth housing support projects', 'the housing occupation', 'employment type', 'housing type', and 'age' factors have a significant effect on the intention to use the housing support policies. Specifically, the intention is positively associated with economic activity, one-room residence, monthly rent, employment status during the Covid-19 period, and policy recognition, while negatively related to age. In addition, willingness to use the housing support policies is greater when respondents lived in a studio, lived on a monthly rent, recognized the policy, and improved their employment status. The results suggest that housing support programs need to be expanded and improved. Moreover, information on housing support policies should be efficiently delivered to eligible households, and more sophisticated housing support policies should be provided for young people early in their careers.

• Journal of the Korean Geographical Society
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• v.46 no.4
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• pp.480-500
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• 2011

This paper aims to describe the rapid growth of the one-person households in terms of the socio-economic demographic perspectives during the period of 1995-2005 and to analyze the spatial distribution patterns based on different characteristics of one-person households. The increase in the divorce ratio in the middle-aged, the growth of unmarried people the young generation, and the increase of life expectancy in the old generation are explanatory factors for the rise and diversification of one-person households in Korea. The rapid increase of one-person households is accompanied by a diversification in their age, gender, marital status, education level. Uneven distribution of one-person households depends on their age, level of education and dwelling type. Highly educated young adults residing in their own apartment are generally concentrated in major cities, whereas senior citizen with their own single house who lives alone are mostly in rural area. One-person households of the highly educated young adults are significantly polarized in the light of their the living standards. In particular, metropolitan area or big cities are mixed with those who have their own apartment and are financially capacity and with those who rent in a detached single house. As such, one-person households have considerably heterogeneous characteristics. Therefore, each local government will face different economic and social problems based on which group of one-person households are increasing and where they are concentrated in. To this extent, the local government should have differentiated welfare policy according to its own respect.