Searching for suitable accommodation in Korea can be a daunting process as the rental market and system in Korea are significantly different. Those journeying to Korea for the first time may be limited in their ability to adequately survey and judge what type of property will best suit their needs particularly because of the initial language barrier.
For those interested in travelling to Korea or currently in country, we have collated the best information available and provided inside advice on how to find rental properties without the uncertainty
The pricing mechanism for housing in Korea is different from the traditional bond and weekly rental system that most people are used to in Australia.
Rental housing in Korea is divided into two major categories Jeonse (전세) and Wolsae (월세).
Jeonse (전세) involves the tenant giving the landlord a large sum of “key money”, which is typically 60-80% of the property’s value. The provision of “key money” allows the tenant to live rent free until the end of lease (usually 2 years). This deposit is then used by the landlord to invest and keep all of the interest earned. After the lease is finished, the entire deposit is then returned to the tenant.
Given that the landlord is able to invest the key money deposit – on the condition it must be returned at the end of the contract period – it’s critical to do due diligence on the landlord and the property as tenants have had issues in re-claiming their key money deposit. The best way to protect yourself as a renter is to register your deposit with the nearest local government office (구청) to your property. You can also have the option of doing credit checks on the landlord and the property. A general rule of thumb in Korea is to check whether the landlord owns the property or apartment room in full to get some assurance that you will be able to recover your significant key money.
Jeonse is unfortunately (for tenants) losing popularity in the Korean housing market with low interest rates and small margins to be had on other investments, leading to lessors fast adopting a similar rental system to that of Australia.
The other major form of rental that is becoming more common in Korea is Wolsae (월세). Wolsae is similar to the rental system that you will encounter in most Western housing markets. Wolsae will involve a lower key money bond with the need to pay monthly rental fees to the landlord. Over the last 12-18 months in Korea, the trend has moved towards Wolsae as Jeonsae has simply become unaffordable and unsustainable for landlords and tenants alike.
Average deposits for Wolsae will start at 5,000,000 KRW and can go up to 40,000,000 KRW: the higher the initial key money typically coincides with a lower monthly rent. However, Wolsae too is slowly beginning to drop in popularity as lessors seek the more reliable cash flow from monthly rent, slowly reducing key money amounts. You will notice that in Korea paying one month’s rent as bond is not common – although one could surmise that this might be the trend in the future. With no housing authority with which to lodge the bond, the bond or “key money” is held directly by the landlord. As a result, there are some perceived risks with the system, which is why it is important to register yourself at the local office and also run background checks on the financial situation of the building landlord.
Typically there is the opportunity to negotiate the rental fees with your prospective new landlord, directly leveraging length of stay and key money to bring down the rent.
Utilities, Maintenance Fees and Rubbish Disposal
When renting an apartment or villa in Korea you will be hit with a building maintenance fee. This will cover things such as internet, elevator maintenance, garbage disposal and building security guards. In villas, there will be a consensus among the neighbours to contribute a small fee to cover the cost of washing the villa exterior during the months in spring.
Be aware that in addition to your monthly rent there will be additional costs related to utilities and internet. However these too are also sometimes factored into the cost of monthly rent. For example, some apartment buildings which have direct internet and pay-tv connections may make these costs part of the administration fee, saving you the trouble of setting up your own separate account.
Building maintenance fees costs vary but can start from anywhere between 50,000 KRW -110,000 KRW / Month.
Gas, Water and Electricity quite often will not require a separate registration and you will simply be required to take care of the bill that will be sent to your letterbox; the accounts are often in the name of the landlord which means there will be no difficulty in setting up your own accounts. Of these charges, gas is likely to be the largest burden as Korea does not have any native gas resources and thus imports LNG. Gas is also a major cost during winter because of the Korean ‘Ondal’ heating system. Under this system apartment floors are heated via hot water pipes laid under the flooring; each apartment is likely to have its own boiler which will require the metering to be checked regularly. Some local gas employees will message the tenant via text message to ask the tenant to relay the current metering number and will intermittently visit the property to check. This is an opportune time to note that in Korea there are no requirements for the landlord or property manager to provide notice of entry so don’t be too alarmed to find out that your property manager let in a repairmen/gas worker without your consent.
You will also notice that there is unlikely to be any identified trash bins: some buildings may have a trash chute, while others will require you to drop your trash outside on the curb. Under this system trash collection is paid for by taxing the plastic bags which trash is required to be placed in. These trash bags can be purchased from any convenience store or mart in your local area and will correspond to the area you are living in. Trash which is not placed in these bags may not be picked up so it is important to note that you will require purchasing these bags as soon as you move in. Trash is divided into regular and food scraps, regular bags are white while food scraps are yellow; it is expected that you divide your food scraps from your regular waste. Most buildings will have some form of recycling system at the bottom of the building so be aware that you should probably avoid throwing away typically recycled products into regular trash.
When dealing with your landlord and handing over a large amount of key money, it is essential to check the building’s deung-gi-bu-deung-bon. This can be done through a realtor and it will confirm the identity of the landlord and check for building debts. When there is a building debt then it is unlikely you will recover your key money deposit at the end of the lease. There is no major housing authority equivalent to the Australian association. If you do fall in to a dispute with a landlord over key money you will have to sue the landlord to recover the funds; a time consuming and costly process.
When you think of housing in Korea you will also hear the term ‘pyung (평)’. Instead of traditionally working out the size of your house in square meters or feet Koreans tend to use a traditional form of measurement. Pyung is roughly 3.3 square meters or 3.5 feet approximately. When you visit your local real estate agent (부동산) you will find most still use pyung to measure apartment sizes.
Types of Housing
Some of the options available for housing include the apartment, villa, officetel, goshiwan. Apartments and villas will be larger and appeal more to people with families. Styles of apartments and villas can vary; most will have a balcony area and villas are usually older with fewer neighbours. Officetels are smaller and genuinely found in the same buildings with smaller businesses. The first few floors in a building will contain small businesses with officetels above that. Goshiwans are more short term one man style accommodations, which invariably involve sharing the facilities with other tenants.
If you have money to spend and are planning on a long-term family stay in Korea then consider an apartment. Korean style apartments are built for families; although owning an apartment in around the Seoul area can be quite expensive. The majority of people will use the Jeonsae system over a two year contract for an apartment.
In Korea a lot of young couples and students will use officetel (오피스텔). Officetels are smaller style apartments that are located close by subway stations and major shopping areas and entertainment districts. Officetel buildings are a combination of commercial business and residential studio apartments, with convenience stores and other businesses often located in the same building. Your typical officetel is a one room style studio apartment with fixtures such as a kitchen and bathroom built in. Fully furnished apartments in Korea are known as ‘Full-Option” and you will often see officetel rooms advertised as ‘one-rooms’ because they literally fit everything you need into one room; the washing machine is likely to be under your kitchen sink and your bathroom will essentially be a toilet with a shower head above it and a small medicine cabinet.
Most officetels in Korea will come with some type of appliances, including fridges; washing machines; microwaves; and air-conditioners. While most of these will be listed in your rental agreement, in some cases, you can negotiate with your real estate agent or landlord to what you wish to include in order to lower the cost. The typical agreement will include a microwave, washing machine and fridge – don’t expect to see many dishwashers or ovens during your stay in Korea.
Costs for an officetel / one room will depend very much on the area you decide to live in and its proximity to major locations and the subway. General expectations can be for a 500,000 – 600,000 KRW + Utilities with a 5,000,000 KRW key money. Although, to get a better understanding check out the room advertisement links below.
Goshiwons are tiny one room closets with no windows and just enough space for a bed and a desk. This is a form of student accommodation typically found close by to major universities and are good way to save money over a short term stay in Korea. Goshiwons have shared kitchen and bathroom spaces. The costs are cheap and you can expect to pay anywhere from 100,000 KRW to 500,000 KRW. Most of these will also come with free internet given that students stay in these to focus on test study.
Hasuk Jip (하숙집)
A Hasuk Jip is similar to a Goishwon except with the point of difference of providing meals. This accommodation is mainly for students on short term stays in Korea. They are run by elderly women and they will provide two meals per day during your stay. Costs are similar and can range from 300,000 KRW to 600,000 KRW / Month
Where to find a house?
The best place to start is online.
Peter Pan is considered the premier site for young Koreans interested in short and long term accommodation. The site mainly lists officetels / one-rooms and goshiwons. The site is in Korean so you will need a friend to help you navigate the site and contact about the rooms. The site will require a naver login account and many properties listed on this café (?) are break-leases. Break leases require the previous tenant to search for a new tenant to avoid paying fees to a potential property agent and to also avoid any delay in their return of key money. This is also a very good option for the budget conscious house hunter as it eliminates the property agent from the equation, which will save you paying ‘finder fees’.
If you’re not comfortable with your Korean yet then Craigslist will also be a good place to start to look for accommodation. The majority of the places that you will see online are usually listed by the lesser. This has the added benefit of reducing the rental cost as you will not have to pay a finder’s fee to the real estate agent. You will also find many places on here listed by Korean real estate agents who are actively targeting the foreigner market. Whilst these advertisements will have a finder’s fee attached, for some it will give piece of mind to have an English speaking property agent support you.
Real Estate Agents (부동산)
You can find a real estate agent in most areas close to subway stations. If you can speak and read some Korean there is also an app available that can be downloaded called 직방. Real estate agents in Korea act as a matchmaker between property owners and buyers or renters. There are no notice periods for inspections in Korea and Real Estate agents will generally show you 4-5 properties in about a 1-2km radius without any prior booking. It is actually a good plan to set aside your first weekend in Korea to scope out the areas you plan to live in and visit some Korean real estate agents (accompanied by a friend). The speed of the market means that you can see a heap of properties in a few hours; conversely you will also be expected to make a quick decision as houses disappear just as quickly so don’t feel overwhelmed by the fast nature of the transaction – it is normal for Korean to see a house, agree terms and move in within the matter of two days.
Korean realtors will charge a finder’s fee and it’s important to investigate if this cost is split between yourself and the owner or if you are paying the full cost. The general formula for commissions is about 1% of the purchase price or 0.5% of the rental price. Realtors will also provide different services such as moving services and in that case will more than likely charge a higher fee. So you will be looking at a fee of 200,000 KRW to 300,000 KRW. The formula set by the government is your key money + your rent x 100 = realtor commission.
When it comes to moving in Korea forget doing it yourself! Korean moving companies have turned the art of moving apartments into a science.
Spring is considered the best time to move in Korea. During spring you will likely spot many moving cranes at many of the Korean apartment complexes. Moving outside of spring will result in a cheaper rate with most movers.
For larger moves, moving companies will consist of 2-3 trucks. If you are in a high rise they will send a crane truck. Generally with moving companies you are able to specify a day and a time in advance. They offer all types of services, with some companies able to clean and pack for you in both your old apartment and new apartment. Your team of movers are normally 2-3 men and a woman.
For some couples and students you don’t have to go to the trouble of hiring larger companies. You are able to hire a “bongo truck”. A bongo truck is a small blue truck similar to a ute and is used for smaller moves. The driver will pack all your things and will unload at your new place. This type of moving service is aptly named ‘학생이사’ or student moving.
In either option the moving company will ask you for a date and a time and the floors you are moving from. It is best to specify the services you also want. They will take a deposit for 50,000 KRW to 100,000 KRW. Depending on services you need, prices will range from 200,000 KRW to 400,000 KRW
Things to do when you move
Once you decide on moving there are some things you need to take care of. Once of the most important is registering that you have moved with the local Gu office. You have a 14 day window to do this and you will require your ARC (Alien Registration Card). Many foreign residents and students don’t know about this ordinance and only discover it when they go to renew their visa in Korea at the immigration office. Penalties for missing this include fines and delays on renewing your visa.
You will also need to fix all your utility bills and also have your mail forwarded to your new address.
So where do most foreigners live in Korea? You will find a good number of the ESL types stationed around the Itaewon or Habangchon area, which are great if you are looking to explore the nightlife in Seoul. The majority of companies will look to house their employees around the UN village or French quarter area. Families or those searching the quiet life have drifted towards western Seoul, Mokdong, Gimpo, Bucheon. There are also growing international communities in Suwon, Ilsan and Bundang. The majority of student style accommodation can be found around most university campus areas or close by.
If you are coming to Korea without housing its best to look at real estate agents with the help of a Korean friend. Although, there are also a growing number of English speaking real estate agents who can help you to find a house. As well as the price other major things to consider are the distance to subways and buses.
Looking for an internship or job in Korea? Check out our guide on how to find internships and jobs in Korea
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