Seoul Mayor Oh Se-hoon was in the hot seat last week for reversing his controversial decision to lift regulations that were in place to curb real estate speculation in the city’s most sought-after districts. The regulations required buyers in these areas to get approval from district offices and fulfill two-year mandatory occupancy conditions, which means they were banned from purchasing houses with "jeonse."

Jeonse is a lease system in which a tenant pays a lump-sum deposit for a two-year rental. At the end of the contract, the landlord returns the full amount. This system, unique to Korea, makes it financially easier for homebuyers because they don’t need to raise the full amount to purchase a house, thanks to the lump-sum deposit from a tenant.

On Feb. 13, Oh removed these rules, citing concerns over property rights infringement. The move triggered sharp spikes in Seoul’s apartment prices in the following four weeks. In particular, the areas most directly affected — Songpa District, Seocho District and Gangnam District — recorded the steepest increases since 2018.

This was in stark contrast to the prolonged slump in regional housing markets as provinces saw more and more residents move to the capital city for higher-paying jobs and better........

© The Korea Times