HOUSING CONSIDERATIONS - Living Abroad in South Korea - page 105

Perhaps unique to South Korea, and still the norm outside of the more cosmopolitan dis-
tricts of Seoul, is the jeonse or full-deposit system, in which the tenant puts down a signific-
ant chunk of money, typically 50 to 70 percent of the price of the house or apartment, and
no monthly rent is charged at all, with the landlord instead profiting from banking or invest-
ing the sum, and again returning it in full to the tenant on completion of the rental contract.
Relatively few foreigners go this route because of the amounts involved—200 million won
or more for a typical middle-class home in Seoul—and the fact that banks are reluctant to
extend jeonse loans to expatriate tenants (although those with South Korean partners may
have more luck). In the past, landlords absconding with deposits was a serious problem,
but they are now tracked carefully and “insured” to some extent by the government, so it
has become less of an issue. This is obviously a more cost-effective option for the renter in
the end and a good halfway step between renting and full ownership, but it won't appeal to
everyone.
Hybrid jeonse-wolse arrangements are also possible and indeed welcomed by some
landlords. This will all be down to the landlord's finances and your (or your agent's) negoti-
ating skills, but as a rough guideline you can expect to knock 10 million won off the jeonse
deposit for every additional 100,000 won you agree to pay in monthly rent—thus a landlord
requesting a 150 million won jeonse deposit may very well settle for 100 million won and
500,000 in rent monthly. The reverse also applies—a landlord asking for a 10 million won
deposit and 500,000 won monthly may knock the rent down to 400,000 won if the deposit
is doubled.
Negotiating is a time-honored tactic in South Korea, and while it doesn't tend to move
prices much unless the place was ridiculously overvalued to begin with, if there's something
else you'd like—new wallpaper, a washing machine to be replaced with a newer model,
your landlord to pick up the cable bill—it never hurts to ask.
Whatever rental agreement you sign up for, make sure you obtain certification that the
landlord is the real owner of the property and is not in danger of defaulting on it, and that
any contracts and deposits are registered with the local district office, which will allow you
quicker redress in the case of anything going wrong. These are standard procedures that any
agent should be able to walk you through. Also be sure to check that the contract specifies
which expenses you'll be responsible for (monthly maintenance, parking fees, appliance
breakdowns, etc.) and to take a few pictures of any significant property damage (large wall
stains, dented appliances or floors, and so on) prior to moving in so that you won't be in-
advertently billed for any damage on your way out. Once you've moved in, the agent will