Experts have predicted that the government's decision to extend the application deadline for real-residence grace periods and recognize lease renewal contracts for rental homes within Land Transaction Permit Zones (hereafter permit zones) will help ease trading bottlenecks for homes with tenants.

However, some point out that because the grace period system introduced in May is being expanded again just four months later, the overall system needs to be reviewed in terms of the permit system's core principle of actual residence and policy predictability.

On September 17, the Ministry of Land, Infrastructure and Transport announced that it will extend the deadline for applying for real-residence grace periods for rented homes in permit zones by one year, from December 31, 2026, to December 31, 2027. It also decided to recognize not only the remaining period of current lease contracts but also one renewal contract, allowing an additional grace period of up to two years.

Consequently, if requirements are met, a buyer's move-in date can be postponed until 2029.

However, buyers must maintain their status as homeowners without a house starting May 12 of this year, and the obligation to reside in the property for two years after moving in will also remain in place.

Experts initially evaluated that this measure could partially resolve the issue where properties meant to enter the market following tax code revisions are blocked by the land transaction permit system.

Kim Hyo-sun, senior real estate expert at KB Kookmin Bank, said, "This seems aimed at resolving the misalignment where properties emerging from tax revisions are blocked by the permit system, while also recognizing renewal contracts so that homes with living tenants can be traded while remaining as rental supply."

However, she pointed out, "While tax policies can shift the timing of sales, transaction regulations must be adjusted together for those properties to lead to actual trades. At the same time, since recognizing renewals delays a buyer's move-in by several years, we need to review consistency with the original intent of the permit system, which only permits transactions for actual residence purposes."

She added, "The fact that the government repeatedly extends grace periods could conversely mean that a structural policy adjustment is necessary."

Opinions were divided on whether this measure would actually lead to an increase in trading volume.

Lee Eun-hyung, a research fellow at the Korea Research Institute for Construction Policy, stated, "It is burdensome for general buyers, who premise purchases on actual residence and demand, to sign sales contracts based on long-term move-in and balance payment dates a year or a year and a half into the future. Extending grace periods for people who already found it difficult to sell their homes will not lead to an immediate surge in transaction volume."

He also pointed out, "Frequent revisions and supplements could lead to discussions that policies are being implemented without sufficient preparation."

On the other hand, Ham Young-jin, head of the Real Estate Research Lab at Woori Bank, projected, "While respecting tenants' contract periods, homeless individuals will still be able to purchase homes in regulated areas next year, which is expected to broaden the range of tradable properties." He added, "If the reduction in transfer tax surcharge rates for multi-home owners in regulated areas and the revision of the long-term holding special deduction for transfer taxes are finalized next year, it could help increase listings and recover transactions."

Nam Hyuk-woo, a real estate researcher at Woori Bank, also forecasted that ahead of reduced benefits from tax revisions, selling volumes from non-resident high-priced homeowners, multi-home owners, and rental business operators are likely to concentrate next year.

Nam evaluated, "As this grace period measure allows properties emerging ahead of tax revisions to be traded smoothly, it will provide some breathing room to the current market, which suffers from a shortage of properties for sale."

Assessments indicated that including renewal contracts in the grace period targets could help stabilize tenant residency.

Expert Kim Hyo-sun said, "Recognizing renewal contracts has practical significance for the jeonse and monthly rent market in that it breaks the pattern where rental supply diminishes every time a property transaction occurs."

Lab Head Ham also evaluated, "It is more appropriate to view this measure as a systemic supplement that mitigates friction between home sales and lease agreements, rather than a policy that dramatically expands jeonse supply."

However, concerns persist that long-term actual move-ins by buyers could eventually reduce rental supply.

Researcher Nam noted, "If selling volumes from rental business operators, non-resident homeowners, and multi-home owners concentrate, it will have the concurrent effect of reducing jeonse and monthly rent listings, creating the possibility of heightened volatility in lease prices."