Extension of Actual Residence Grace Period in Land Transaction Permit Zones... 'Lease Renewal Contracts' Also Recognized

The grace period for actual residence in housing currently under lease within Land Transaction Permit Zones (Land Transaction Permit System) will be extended and expanded. During a live broadcast on September 20, the YouTube channel 'Genesis Park' analyzed this measure, explaining that if one makes good use of the fact that grace periods are also recognized for lease renewal contracts, it will be helpful for selling strategies.

Application Deadline Until the End of Next Year... Lease Renewal Contracts Also Additionally Recognized

According to the details introduced in the broadcast, the core of this measure released on September 17 is the extension and expansion of the actual residence grace period within Land Transaction Permit Zones. To protect the right to trade housing currently under lease within Land Transaction Permit Zones, the Ministry of Land, Infrastructure and Transport is extending the application deadline for the actual residence grace period announced last May until the end of next year. For houses within Land Transaction Permit Zones where it is difficult for a buyer to move in immediately because a tenant is residing there, they will be able to apply for an actual residence grace period until the end of next year. The relevant amendment to the enforcement decree was announced for legislation on September 18 and is scheduled to take effect from October 1.

What is newly included this time is the lease renewal. In addition to the current lease period, the actual residence grace period will be recognized up to the lease renewal contract. In the broadcast, it was emphasized that this part is very significant and should be utilized well. This measure reflects matters proposed in the ruling party's parliamentary measures.

Homeless Requirement and 2-Year Residence Obligation Remain Unchanged

However, the buyer's requirement to be a homeless actual demander and the 2-year residence obligation after moving in remain unchanged. In the broadcast, it was explained that the homeless actual demander requirement continues to apply based on the standard of May this year, meaning that even if one becomes homeless by selling all houses while currently owning multiple houses, they cannot satisfy the requirement.

Because of this, methods for multi-homeowners to sell were also discussed. The best way is to sell the house while it is vacant or to sell it by cooperating well with the tenant; if that is not possible, one should negotiate with the tenant to make it vacant, so it is good to have an amount equivalent to the jeonse deposit in cash. The broadcast stated that having a certain amount of cash provides peace of mind and that such preparation is necessary for multi-homeowners, especially those who have engaged in gap investment.

If Tax Benefit Period is Pushed Back, the Grace Period Application Period is Also Adjusted

The changes also include adjustment mechanisms linked to tax reforms. If the period for applying tax benefits is adjusted later than originally planned—such as when registered rental housing like purchased rental apartments in adjustment target areas still has an obligatory rental period remaining, or when the transfer of member status is restricted due to reconstruction or redevelopment within speculative overheated districts—the actual residence grace period application period will be adjusted accordingly. In the broadcast, it was evaluated that this part is very significant, noting that there were many discussions that the tax reform plan would only be completed if the deadline is extended because this part was not properly handled in the current tax reform plan, and it happened as expected.

The timing when the transfer of member status is restricted was also explained. In a speculative overheated district, reconstruction is restricted from the very early stage of obtaining authorization to create a union corporation, which is the subject of the maintenance project—namely, from the authorization of union establishment—so it cannot be sold. Redevelopment is restricted from a later stage, the authorization of the management and disposal plan, and the broadcast explained that once the management and disposal plan is authorized, people usually move into new apartments in about 4 to 6 years.

Emphasis on Inducing Listings Rather Than Tenant Housing Stability

The broadcast also addressed the nature of this measure. This measure is linked to tax reforms, such as the heavy taxation on capital gains for multi-homeowners and the phased abolition of tax benefits for purchased rental apartments in adjustment target areas, and while it also considers the housing stability of tenants, the conclusion is that tenants must leave when the contract ends. The broadcast emphasized that this measure ultimately places more weight on inducing more listings into the current market rather than the housing stability of tenants, and that this point must be clearly understood.