'We have our reasons': Landlords offer short-term leases of 3 to 5 months instead of the standard two years

A, a non-resident owner of a Seoul apartment, plans to sell the unit early next year. After the previous tenant's lease expired, he left the unit vacant — deliberately avoiding a tenanted listing that could complicate the sale. Forgoing rental income has become a burden, however, and he is now weighing whether to take on a short-term tenant for two or three months.

As the government tightens real estate regulations, more landlords are listing short-term rentals to offset vacancy costs before a planned sale. The arrangement is emerging as a way to earn rental income while avoiding the complications that the lease renewal right and the land transaction permit system can create for sellers trying to manage their sale timeline.

According to industry sources Friday, a landlord at an apartment complex in Gwangmyeong recently found a tenant on a 15-month jeonse contract — not the standard two years — to align with the owner's sale schedule. "The landlord is a registered rental business operator and needed to match a specific timeline," said B, a licensed real estate agent in Gwangmyeong. "It was a listing that would only accept a tenant who agreed to those terms, with a future transaction in mind."

Short-term listings specifying contract periods of three to five months, or anywhere from three months to one year, have become increasingly common in place of the standard two-year lease, industry insiders say. They attribute the trend to growing demand from non-resident owners bridging the gap before moving in themselves, as well as from landlords timing a sale.

The expansion of the short-term rental market cuts both ways. For tenants with temporary housing needs — those undergoing home renovations or caring for a family member — it widens their options. Domestic short-term rental platform Samsam M2 recorded 120,000 transactions in the first half of this year, already about 75 percent of its full-year total of 160,000 for last year, underscoring how quickly demand is growing.

The government recently allowed homebuyers without property to temporarily purchase tenanted listings to encourage multi-unit owners to put homes on the market. That policy makes short-term rentals a practical option for owner-occupiers who need to fill the gap between a current tenant's departure and their own move-in date.

On the other hand, concerns are mounting that if housing previously available as standard jeonse or monthly-rent leases shifts to short-term arrangements, the supply of ordinary rentals — where tenants can exercise the lease renewal right — will shrink, adding instability to the market.

"With regulations such as the owner-occupancy requirement and the ban on pre-ownership transfer jeonse loans piling up, landlords may deliberately choose short-term leases to raise funds or minimize penalties," said Yoon Ji-hae, head of the research lab at Real Estate 114. "It is a form of market distortion — landlords adapting to regulations — and that aspect cannot be overlooked."

Industry practitioners say both landlords and tenants entering short-term lease agreements should carefully review the contract terms to protect their respective rights. The Housing Lease Protection Act takes precedence over ordinary civil lease contracts as a special statute. Under Article 4 of the act, a residential lease with no fixed term or a term of less than two years is in principle treated as a two-year lease.

As a result, some landlords specifically seek tenants with a clear reason to stay for only a limited period — such as those waiting to move into a newly built apartment or those temporarily displaced by renovation work. Others attach conditions barring tenants from registering their residency to reduce uncertainty around the end of the contract. Tenants who agree to such a restriction, however, will find their ability to exercise future legal rights significantly curtailed.

"Under the Housing Lease Protection Act, registering residency, obtaining a fixed date stamp, and actually occupying the unit are all essential to establishing tenant protection rights — if a tenant does not register their residency, exercising those rights becomes very difficult, and they need to understand that before signing," said Park Hap-su, an adjunct professor at Konkuk University's Graduate School of Real Estate. "As a precaution, I recommend tenants keep the deposit to no more than one year's worth of monthly rent, or minimize it as much as possible."