New offerings designed for individuals in their 20s and 30s are becoming increasingly popular in the real estate sector. As per the Supreme Court's Registration Information Plaza, five out of ten tenants this year are aged 30 or younger, indicating strong interest from younger demographics. With financial pressures increasing because of higher monthly rents and jeonse deposits, housing services focused on reducing these expenses are growing in scope.
As reported by the Korea Real Estate Board on the 3rd, the average monthly rent for housing in the capital area exceeded 1 million South Korean won for the first time in April and hit a new peak of 1,031,000 South Korean won in August. The average jeonse price for housing in the capital region has also increased for 27 straight weeks since June 2023, reaching 334,730,000 South Korean won in August. A representative from the real estate sector stated, "With rising jeonse and monthly rent prices in the capital region, the financial pressure on young people living in Seoul is increasing."
◇ Services That Help Lower Monthly Rent and Jeonse Deposit Costs Are Becoming Popular
KRG Group, a real estate leasing company, offers "Guaranteez," a service that guarantees monthly rent. Guaranteez enables tenants to reduce large jeonse deposits, which can reach tens of millions of Korean won, by offering a guarantee. For instance, to live in an officetel in Sillim-dong, Seoul, one would usually pay a monthly rent of 400,000 Korean won and a deposit of 10 million Korean won. With Guaranteez, tenants pay a fee of 5–10% of the monthly rent when signing the contract and can instead pay a monthly rent of 450,000 Korean won without a deposit. Tenants pay Guaranteez the monthly rent, which is then passed on to the landlord. If a tenant fails to pay, Guaranteez covers the payment to the landlord and later seeks reimbursement from the tenant. Kim Junyoung, co-CEO of KRG Group, stated, “Landlords can receive higher monthly rent instead of deposits, while tenants avoid the need for a large initial payment. As a result, the number of contracts is growing by 20% each month.”
There is increasing interest in services that enable tenants to pay their monthly rent using a credit or debit card. "JibUp Pay," a platform developed by the fintech company Devdy, allows for card-based rent payments without requiring the landlord's approval. Tenants can upload their lease agreement to JibUp Pay, register a card, and Devdy will automatically transfer the rent to the landlord on the due date. The service has already processed over 1 billion South Korean won in total transactions within six months of its launch. With an average user age of 26.8 years, it is especially popular among younger individuals. Other fintech companies, like RentalPay, provide options to divide monthly rent into installments through card payments, while Zigbang also offers a card-based automatic rent payment system.
◇ Services Aimed at Preventing Jeonse Fraud Also Introduced
Services that tackle hidden dangers in the real estate sector, including jeonse scams and falling apartment values, are also gaining traction. "Safe Butler," an AI-based real estate service, provides tools to avoid jeonse fraud. It highlights jeonse properties with deposit insurance on a map and shares details about whether landlords own multiple properties or have unpaid taxes, improving contract security. "Hedge Haeji," managed by Korea Asset Purchase, enables apartment owners to sell their property at a set price. For example, if a buyer signs up for the service before moving into a newly constructed apartment, Korea Asset Purchase will buy it back at the original move-in price even if the market value decreases after a specific time. A representative from Korea Asset Purchase stated, "Local apartment prices often drop after sales, so this service offers a safety buffer for owners."
Services that make lease contract reporting easier are also gaining popularity. Since June, lease agreements with a deposit over 60 million South Korean won or a monthly rent of 300,000 South Korean won must be reported to the Ministry of Land, Infrastructure and Transport within 30 days, or a fine of 300,000 South Korean won will be applied. Previously, the complicated procedure caused many tenants and landlords to face penalties. To solve this issue, Jari Company introduced a service on its property management platform "JariTalk" that automatically finishes the reporting process in one minute by uploading a photo of the contract. A representative from Jari Company stated, "From finding housing to reporting, payments, and management, various real estate services are reducing entry barriers in the industry."
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