Jeonse, will it be extinguished? Differentiation of Korean rental housing market

Abstract

Recently, there are large changes in the Korean housing rental market and assertions that the Jeonse system will eventually disappear. This study analyzed the Jeonse system from the viewpoint of the process of institutional changes and causes that can be theoretical grounds for whether Jeonse will be maintained, changed, or disappear. As a result, as the environmental factors that may trigger a change do not reach the threshold, it was analyzed that the Jeonse system will be maintained or amended rather than disappear. Thus housing rental system is being differentiated. The representative case is the emergence of “quasi-Jeonse” as a new lease system. Accordingly, the structure of the rental housing market has changed by differentiating into the three systems of Jeonse, quasi-Jeonse, and monthly rental. Quasi-Jeonse, which is a transformed system of Jeonse, has lots of characteristics of Jeonse eventually, though it has partial characteristics of monthly rental as well.