2 out of 3 tenants who have lost their deposit will be in 2030

Mr. A (37), who moved into a new villa in Gangseo-gu, Seoul in 2017 on a charter basis, continues to live in ‘crying and eating mustard’ even though his contract expired two years ago. This is because the landlord is holding on to paying 190 million won in jeonse money until the next tenant shows up. Thanks to the Jeonse Deposit Guarantee Insurance (Jeonse Insurance) of the Housing and Urban Guarantee Corporation (HUG), 160 million won was received from HUG, but the remaining 30 million won was in danger of being blown away. His house is put up for auction and the money has to be recovered by auction, but auctions are taking place one after another.

On the 10th, Senator Kim Sang-hoon, a member of the National Assembly’s Land, Infrastructure and Transport Committee, analyzed the status of ‘intensively managed multi-household debtors’, which are malicious landlords of HUG. HUG classified the lessor who returned the deposit to the tenant on behalf of the landlord in three or more cases, and the amount was more than 200 million won, or the lessor who did not want to repay due to loss of contact, etc.

More than half (54.1%) of the victims of warranty accidents caused by malicious landlords were in their 30s. If you add up victims in their 20s (13.5%), 2 out of 3 victims are in their 20s or 30s. The reason why there are so many young victims is because most of the villa tenants who are at high risk of guarantee accidents are young people, such as newcomers and newlyweds. The HUG statistics are counted only for cases where the tenant has purchased cheonsei insurance in case the tenant withdraws the security deposit. Considering the cases not caught in the statistics, the scale of the damage is likely to be greater.

Even if the villa is newly built, the sale price and the jeonse price are almost the same or even the jeonse price is higher, so it is possible to buy a house with a tenant deposit without a single penny. In fact, there are many lessors who have bought hundreds of houses in this way. The problem is that if the next tenant doesn’t show up, it’s difficult for the old tenant to get their deposit back. The fact that 34.1% of the damage caused by guarantee accidents in their 20s and 30s were concentrated in Hwagok-dong, Gangseo-gu, Seoul is also largely due to the concentration of new villas in Hwagok-dong. The so-called ‘Three Mother and Daughter Gap Speculation Group’, which disappeared without returning the 30 billion won deposit of about 70 tenants, also intensively bought villas in Hwagok-dong. Rep. Kim said, “The gap speculator disclosure law (tentative name) should be prepared so that tenants can know the risk level of the lessor before signing a contract.” Koh Jun-seok, an adjunct professor at Dongguk University’s Graduate School of Law, advised, “If it is unavoidable, you should buy jeonse insurance and avoid villa jeonse with a small difference between the sale price and the jeonse.”

Reporter Ho-Kyung Kim kimhk@donga.com Go to reporter page>