Tenants in private rental housing to gain stronger right to information

Monthly rent listings for studio apartments are displayed at a real estate agency near Sungkyunkwan University in Seoul ahead of the second-semester start. [Yonhap]
Monthly rent listings for studio apartments are displayed at a real estate agency near Sungkyunkwan University in Seoul ahead of the second-semester start. [Yonhap]

Starting in April next year, rental business operators will be required to report management fees and utility charges — or the method used to calculate them — when registering lease contracts. The measure follows President Lee Jae-myung's directive earlier this year ordering related ministries to address what he called the criminal practice of excessive management fee hikes at multi-unit buildings.

The Ministry of Land, Infrastructure and Transport said Tuesday that a partial amendment to the enforcement decree of the Special Act on Private Rental Housing was approved at a Cabinet meeting.

The amendment was drawn up to improve transparency in management fees and utility charges and to strengthen oversight of private rental housing.

Under the revised rules, rental operators filing lease contract reports must now include management fees and utility charges — or the formula used to determine them — in addition to the existing requirements of lease term, rent amount, loan balance and tenant status. Local government heads, who currently publish landlord-reported rental conditions only in official municipal gazettes, will also be required to post the information on their websites.

In addition, metropolitan and provincial governments will be allowed to set by ordinance the maximum rate of rent increases for private rental complexes of 100 units or more, curbing arbitrary rent hikes by landlords. Tenants will also be able to check rental deposit guarantee enrollment information through the rental housing information system, known as Rent Home.

The amendment also eases some fines for minor violations — such as failing to file a lease contract report — in response to local government feedback that the existing penalties were disproportionately high.

Earlier this year, President Lee spoke out sharply on the issue at a Cabinet meeting. "I hear that because there are restrictions on rent, some landlords are raising management fees at multi-unit buildings and commercial properties," he said. "They even refuse to show a breakdown of the fees — that makes no sense. It's hidden, but it's actually criminal behavior."

The amended enforcement decree will be promulgated Oct. 27 and will take effect six months after promulgation.


hss@heraldcorp.com