Rates Up, Jeonse Prices Soaring... Newlywed Beuttimok Loan Halved

As the base rate rises for two consecutive months and Seoul's jeonse (lump-sum housing rental) prices climb, new loans issued under the Beuttimok Jeonse Loan program for homeless citizens have plummeted by more than 40% year-on-year.

In particular, loans targeted at newlywed couples have dropped by nearly 60% over the past two years. With Seoul's median jeonse price for housing exceeding the 400 million won ceiling for the newlyweds' Beuttimok loan eligibility, calls are growing to update the loan criteria to reflect current market realities.

According to data obtained from the Korea Housing & Urban Guarantee Corporation (HUG) by Representative Song Eon-seok of the People Power Party and the National Policy Committee on Sunday, new Beuttimok jeonse loans totaled 124,959 cases last year, marking a 42.1% decrease from 215,833 cases the previous year.

The total loan amount also dropped by 45.5%, falling from 24.7902 trillion won to 13.5041 trillion won.

New loan cases in Seoul fell by 44.5% from 70,328 to 39,057 over the same period.

New loans under the newlyweds-dedicated Beuttimok program dropped from 33,149 cases in 2023 to 28,262 cases in 2024, and further down to 14,196 cases in 2025.

This represents a 57.2% decrease over two years.

To qualify for the Beuttimok loan, applicants must meet income and asset requirements, as well as the deposit ceiling for the target property.

The eligibility caps for lease deposits are 300 million won or less for the Seoul metropolitan area and 200 million won or less for non-metropolitan areas under the general Beuttimok; 400 million won or less for the metropolitan area and 300 million won or less for non-metropolitan areas for the newlyweds-dedicated version; and 500 million won or less for the metropolitan area and 400 million won or less for non-metropolitan areas under the newborn-specialized program.

According to KB Real Estate, Seoul's median housing jeonse price rose from 370 million won in January 2024 to 406.67 million won in December of last year, surpassing the metropolitan ceiling for the newlyweds' Beuttimok loan.

By August of this year, the figure climbed further to 425 million won.

Consequently, more than half of Seoul's housing stock now falls outside the jeonse price eligibility threshold for the newlyweds' Beuttimok loan.

Compounding this, upward pressure on commercial loan rates has also intensified.

Following its decision last month to raise the base rate from 2.50% to 2.75% per annum, the Bank of Korea's Monetary Policy Board implemented an additional 0.25 percentage point hike to 3.00% on the 27th.

As base rate hikes translate into commercial jeonse loan rates, homeless tenants who need to borrow jeonse funds are likely to face heavier interest burdens.
 

(Photo: Yonhap News)
※ Please note: This article was translated by AI and may contain errors.