Moving can be an enormous pain in the ass no matter who you are or where you live. Doing it in a country with a language barrier and endless cultural pitfalls can be down right aggravating. Having recently gone through the process myself, I can attest to the fact that it is not at all a walk in the park but, with a little bit of knowledge, a spritz of logic and nerves of steel you can find a new place in Korea without resorting to violence.

The fist term you need to know if you don’t already is “key money.” Key money (“jeonse” in Korean) is a relatively large amount of money, usually 10-20  times the monthly rent, given to the owner of the house as deposit/collateral and sometimes rent. The higher the key money, generally, the lower the rent and at a certain point, key money is all you need to secure the property for the term of the lease, usually about half of the properties value. This is called leasing or “jeonse”. The key-money is always supposed to be given back to the renter after the term of the lease is up. Another type of “wolse” payment plan requires monthly payments and no  .

A Real Estate Broker in Daegu

In my experience I was living in an apartment that I had personally put the key-money for when I decided to move. It was also six months before my lease was up and I had paid an entire years rent at the beginning of the lease. In this situation, because my lease was not up, the onus of finding a new renter was on me. What this amounts to is hiring an agency to find a new renter for your place. Agencies are located all over the place but your best is to find the ones nearest to your apartment. You can of course list your apartment with as many agencies as you like but its such a competitive market that you don’t want to announce that to your agent.

Another term you need to be familiar with is “pyeong.” Pyeong is roughly 3.3 square meters and is the standard measurement in Korean real estate.

The next thing to do is to find a new apartment which is relatively easy. You just go the the neighbourhood you want to live and find an agency in the area. They will have a list of available places in near by and will take you there to see them first hand, usually on the spot. There are five basic kinds of properties in Korea, most common among them being the “Aparteu” which means, you guessed it, apartment that ranges from 20 to 90 pyeong. This refers specifically to big high-rise apartment buildings arranged by number in a “danji” or “six-pack” as they are colloquially termed. “Billas” or “Villas” are three to five story buildings usually upscale and range from 50-60 pyeong. An “offictel” is similar to a “villa” but is usually in a high-rise and much more up market. Officetels are used as both residential and commercial space and run from 12-20 pyeong on average.  ”One-rooms” are semi-furnished and generally very small, 13-17 pyeong and are in low rise buildings and commonly rented by hagwans to house foreign teachers. A “Goshiwon” is the smallest type and is more akin to a dorm room or boardinghouse room. These have communal kitchens and are popular with university students. Lastly, the rarest of all are “jutaeks” which are proper houses, generally single occupancy and priced accordingly.

A Tiny Model Apartment at Lotte Castle Gallery

In my case I was looking for a brand new apartment in one of the recently built, but no where near occupied, danjis on the outskirts of Daegu. Why? With the economy in the toilet these days almost no one is buying and there are still tonnes of places that went up during the boom that never sold. There are literally dozens of vacant buildings with owner desperate to sell, lease or rent. We were able to get one for a steal. But that doesn’t mean it was easy.

Real estate brokers in Korea can be pretty shrewd and think nothing of bending the truth to get you to take a place, and often make promises that they can’t keep on behave of the property owner. They also want you to sign as soon as possible and can be very pushy. When it comes to fees, there is not much to worry about as their rates are set by law. Fee can not exceed 0.4 percent of a jeonse or key money deposit of 50 to 100 million won, and can never be more that 300,000 won. You can directly ask a realtor for their brokerage rates as they are required to provide this information to customers.

Once you have found a place that you like, you arrange a meeting with the owner at the agency. There you can negotiate your terms through the broker. Don’t be surprised with they forbid you from exchanging phone numbers as they don’t want to lose the commission if you strike a deal behind their back. When signing the lease there are a few things to keep in mind. Firstly, you need to be sure that the owner of the property actually owns the property and hasn’t borrowed more than 80% of the value, or less than he is asking in key money. This is because, under Korean law, if he defaults on the loan that he used to buy the properly, the bank can repossess the apartment, kick you out and sell it off to the highest bidder. To prove how much equity the owner has in the property he will show you a document from the local Gu office attesting to the amount. This is a great example of something brokers will try to get you to by-pass in order to speed up the deal.

There is no accounting for taste in Lotte's model interiors

Under Korean law tenants are allowed to live in their rental property for at least two years even if the the term is not formally stipulated in the lease. You can shorten the term if both parties agree but you must put it in  the lease. Like any where else in the world you have to get everything in writing. Any terms you agree on have to be in the lease or they are not legally binding.

Once you have signed the lease you are expected to pay 10 percent of the key-money deposit or one month’s rent to the owner to seal the deal. Don’t forget to get a receipt of the deposit, stamped with the official seal of the broker.

On move-in day you need to pay the remaining 90 percent of the key money deposit to the owner of the unit and pays a real estate brokerage fee to the realtor before moving it. After that the place is yours. But you’re not finished yet, the next step is the most important of all if you don’t want to lose your key-money. A “hwakjeongilja,” certificate validates the contract between you and the owner of the property at “the time of the report,” usually the next business day, and ensures your right to collect your deposit at the end of the lease.  First you got to your local Gu office with a copy of the signed lease and your alien registration card, passport ect., to officially change your address.  After that you must visit the registry office with your alien registration card, contract document and official change of address.

At the end of your lease, don’t forget to give notice one month before the lease expires. Failing to do so leaves the door open for the owner of the property to assume that you are staying and thus not be legally obliged to return your key money for another two years. On the flip side, the owner is obliged to notify you one month in advance if they do not intend to allow you to renew the lease.

If all this has left you wary handing over millions in key money take this to heart, your key money is protected by law in cases of fraud for up to 20 million won in Seoul, 17 million won in big cities and 14 million won else where in the country. Also, eviction is very difficult to do legally and there for rare, although officially, eviction is legal after two consecutive missed payments.

One final note: I officially know absolutely nothing about the legalities of anything, take any information in this post as total hearsay and do your own research to be sure have the best information.

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