ID :
183715
Mon, 05/23/2011 - 05:31
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Shortlink :
https://oananews.org//node/183715
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S. Korea's home rental prices jump in April
SEOUL (Yonhap) - South Korea's home rental prices jumped at the fastest pace in more than eight years in April due to a supply shortage and high demand, data showed Monday, stocking concerns about inflationary pressure.
The index measuring nationwide apartment rental prices, or "jeonse," rose 13.6 percent in April from a year earlier, up from the 12.5 percent on-year gain in March, data compiled by Kookmin Bank showed.
The April figure marked the fastest increase since a 14.5 percent gain registered in October 2002, data showed.
South Korea has a unique home rental system called jeonse, under which a tenant leases a home for two years by paying a lump-sum deposit instead of paying monthly rent.
Low- and middle-income households mostly use the home rental system as they cannot afford to purchase their own homes due to high real estate prices.
But a protracted slump in the property market has prompted more people to delay home purchases on expectations that the real estate market has yet to hit bottom. In return, jeonse prices have been skyrocketing, burdening the livelihoods of low- and middle-income families and building up inflationary pressure.
As jeonse prices rise, household loan demand for leases has been on the rise in tandem, raising concerns that households' capacity to service debt could be dented as interest rates are rising.
South Korea's consumer prices jumped 4.2 percent in April from a year earlier, slowing from a 4.7 percent expansion in March. But consumer inflation surpassed the upper ceiling of the central bank's 2-4 percent inflation target band for the fourth straight month.
The index measuring nationwide apartment rental prices, or "jeonse," rose 13.6 percent in April from a year earlier, up from the 12.5 percent on-year gain in March, data compiled by Kookmin Bank showed.
The April figure marked the fastest increase since a 14.5 percent gain registered in October 2002, data showed.
South Korea has a unique home rental system called jeonse, under which a tenant leases a home for two years by paying a lump-sum deposit instead of paying monthly rent.
Low- and middle-income households mostly use the home rental system as they cannot afford to purchase their own homes due to high real estate prices.
But a protracted slump in the property market has prompted more people to delay home purchases on expectations that the real estate market has yet to hit bottom. In return, jeonse prices have been skyrocketing, burdening the livelihoods of low- and middle-income families and building up inflationary pressure.
As jeonse prices rise, household loan demand for leases has been on the rise in tandem, raising concerns that households' capacity to service debt could be dented as interest rates are rising.
South Korea's consumer prices jumped 4.2 percent in April from a year earlier, slowing from a 4.7 percent expansion in March. But consumer inflation surpassed the upper ceiling of the central bank's 2-4 percent inflation target band for the fourth straight month.
