Yoo Ha-jin, 27, looks at a building where she lives in Seoul, South Korea on Feb 21, 2023.SEOUL - A downturn in South Korea's home prices is causing pain in the country's unusual rent-free rental system that benefited landlords and tenants alike during a long surge in residential property prices.
Jeonse tenancy has been particularly popular among people in their 20s and 30s, who could not afford the full price of a home but could use the system to get a toehold into the Korean dream of home ownership. "I thought I would be just fine as long as I could get a jeonse deposit loan from the bank," Yoo told Reuters.
Jeonse deposit loans more than quadrupled in less than six years through October to 172 trillion won, according to the central bank.Property Fallout Unexpected debt burdens on young people could exacerbate risks for the property market, a key sector that drives growth and affects financial markets.
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