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Jeonse rates plummeted to a six-year-low in Seoul and Gyeonggi Province due to a rapid increase in apartment prices in the past few years.
The downtrend has been continuing for 16 months.
However, jeonse prices are expected to bounce back in the coming months with landlords prompted by the low-interest rates and fast-tightening property market.
According to data by KB Kookmin Bank, the jeonse rate in Seoul and Gyeonggi Province in April was 65.1 percent, the lowest since the price hit 64.4 percent in March 2014.
The rates in terms of the region were 54.7 percent in Seoul, 65.1 percent in Gyeonggi Province, and 73.1 percent in Incheon.
The rate in Seoul has been declining for the past year and four months.
The rate for Incheon, which was around 75 percent in 2019, has dropped to 74.7 percent in February, 73.6 percent in March, and 73.1 percent in April.
Data from the Korea Appraisal Board (KAB) pegged the rate in Seoul and Gyeonggi Province at 65.9 percent in April.
Korea has a unique situation where tenants pay a massive lump sum as a deposit, called jeonse, instead of the monthly rent. The housing deposit rate is measured against the market value of apartments.
The ratio is used as a gauge for forecasting the property market outlook.
According to the KAB, the median apartment price in Seoul slid from a record high of 839.5 million won in February, to 839.3 million won in March, and 836 million won in April.
