Nine One Hannam has gained fame as the residence of high-profile celebrities, including RM of BTS and G-Dragon of Big Bang. (Photo courtesy of Daishin F&I)
SEOUL, March 21 (Korea Bizwire) — As high interest rates and growing fears of jeonse fraud continue to reshape South Korea’s real estate market, the trend of converting traditional jeonse (lump-sum rental deposits) into monthly rental contracts is accelerating — with record-breaking luxury lease agreements becoming increasingly common.
According to data released by the Ministry of Land, Infrastructure and Transport, 174 monthly rental contracts exceeding 5 million won per month were recorded so far this year, mostly in Seoul’s affluent neighborhoods of Gangnam, Seocho, Songpa, and Yongsan.
Notably, at the prestigious Nine One Hannam complex in Hannam-dong, a 206-square-meter unit was leased last month for a security deposit of 1.5 billion won and a monthly rent of 25 million won. In Seongsu-dong’s high-end Trimage apartments, a 69-square-meter unit was leased last month for a deposit of 500 million won ($345,000) and monthly rent of 10 million won ($6,900), following a similar deal in January with a monthly rent of 11 million won.
In Banpo-dong’s Acro River Park, a 129-square-meter unit was leased in January for a 315 million won deposit and 10.5 million won in monthly rent.
In 2024, there were 1,404 ultra-high-end rental contracts in Seoul with monthly payments exceeding 5 million won, representing 1.4% of all lease agreements. While still a small proportion, this marks a significant rise from just 0.4% in 2020.
Industry experts point to a growing preference among affluent domestic tenants for luxury apartment living. “Previously, ultra-high-end leases were mostly secured by foreign executives and expatriates,” said one real estate analyst. “Now, more wealthy domestic residents are opting for these luxury rentals, driving up monthly prices in line with surging property values.”
Analysts also note a clear trend of property owners preferring to rent rather than purchase additional properties due to heavy ownership taxes.
“Many homeowners want to live among high-net-worth communities and benefit from exclusive facilities, but instead of buying more properties — which would trigger higher property tax burdens — they are choosing to rent at ultra-high monthly rates, leading to a new ‘just live, don’t own’ trend in the luxury rental market,” the expert added.
Lina Jang (linajang@koreabizwire.com)
