Korean Job Discussion Forums

[Brendan]

Wondering if anyone out there who has made a long-term commitment to staying in Korea and has married a Korean has decided to make the commitment to securing a "real" apartment - that is, an apartment not provided by the school that you work for.

My wife wants us to save out money for "key money" so we can get a nice apartment with all the fixins'.

Fine by me, but it seems to contradict the main reason for being in Korea in the first place - saving money on accomodation that you would pay for back home.

The system confuses me.

I've heard that after you make your initial deposit you can live in your apartment rent-free thereafter and also that you are fully refunded on your deposit after you leave. This makes no sense to me. How can this be?

Would somebody be kind enough to explain this whole buying an apartment and key money thing? Very confusing...

Thanks...

[kimcheeking]

The owner of the apartment invests your money and gets interest. that is how they make money. There are a number of ways to guarantee your money, mostly you have to register the contract with the government. But if it comes down to a dispute you must realize that this will take time.

Basically what my wife and I have done each time we rent is to check that the owner actually owns the apartment. That is they do not have a mortgage.

My key money is 123,000,000 of which slightly less than half is a loan. and my/our plan is to pay the loan off in 2. years. If you need a loan for your key money, consider the interest your monthly rent and the principle as forced savings.

The benefits of living in your own place include: independance from your employer, can do what you want with it, no need to worry about unannounced visitors (re: directors). basically I feel that by taking company housing you are essentially an indentured labourer. Emancipate yourself.

KK

[BTM]

You may find some useful info in my long post in this thread....

(and I'll add to post that with regard to key money vs. monthly rent, it's a sliding scale from 0% of one and 100% of the other to 100% of one and 0% of the other, depending on the owner, and is negotiable, usually. These days, because interest rates are low, many landlords are looking for a larger percentage of the mix to be monthly rent, but there are still many jun-seh (key money only) places out there, for which you will pay no monthly rent, but will need, as KCK paid, a massive deposit.)

[mishlert]

[Gord]

[kimcheeking]

To buy my apartment is 170mil.

Villa's are not as liquid as apartments, don't come with playgrounds for children, and generally parking is more of hassle even when included.

[Real Reality]

Housing, Foreigners Easy Victims

Foreign residents in Seoul are preferred over any Korean tenant by their landlords because they are paying several times as much as what Koreans are paying for their rent, realtors and industry sources say. For a 25-pyong (one pyong equals 3.3 square meters) apartment in Seoul, foreign residents are paying as much as two million won ($1,600) in monthly rent while the same apartment may go for only 500,000 won for Koreans.

Foreign residents are charged as much as 10 percent of their entire contract money, resulting in millions for realtors, partly because they are unaware of the law, but also because most of their contracts are untraceable.
The complete article is available at:
http://times.hankooki.com/lpage/nation/200308/kt2003082818233111970.htm

According to a report released on May 1 by the Ministry of Finance and Economy, the premiums for newly built apartments have shrunk by 10.7 to 33.3% as of April 30 over a week ago. For instance, a Seoul Dogok-Jugong-yicha APT of 26 pyeong saw its premium go down from 60 million to 50 million won. The premium for the 31-pyeong Human Touchville in Gangnam Seoul dropped from 150 million to 130 million won as well.
The complete article is available at:
http://english.donga.com/srv/service.php3?bicode=020000&biid=2003060249568

Poong Lim Industrial Co., a mid-sized construction firm, slashed its sale price of a new apartment from W7 million (US$5,800) per pyeong (3.3 square meters) to W6.2 million. Another construction firm followed suit, and recently cut back its sale price for apartments under construction in Gyeonggi Province from W7 million per pyeong to W5.52 million.
The complete article is available at:
http://english.chosun.com/w21data/html/news/200307/200307170012.html

As for the average apartment price per pyeong in Seoul, Gangnam-gu has the highest average price at KRW 17.52 million. Following Gangnam-gu, the average price in Seocho-gu (KRW 15.58 million), Songpa-gu (KRW 14.3 million), Yongsan-gu (KRW 12.51 million), Kangdong-gu (KRW 11.43 million), Yangchun-gu (KRW 10.95 million), Jung-gu (KRW 10.43 million) and Kwangjin-gu (KRW 10.41 million) all surpassed the KRW 10 million mark.
The complete article is available at:
http://english.donga.com/srv/service.php3?bicode=020000&biid=2003041579778

1. Full payment in advance
For example, a 2-year lease agreement at $5,000/month would require $120,000 up front payment. No money is returned.
2. Key money plus monthly payments
This key money is 10 to 20 times the monthly payment. The larger the key money deposit, the lower the monthly payment.
3. Key money deposit with no monthly payments
Key money is required in the amount of approximately 40% to 60% of the property value. The money is returned later.
The complete article is available at:
Relo & Realty Korea, Inc.
http://www.relo-korea.com/real_rental.html
Housing Types in Korea (from R&R Korea)
http://www.relo-korea.com/real_home.html

[BTM]

Which is all quite helpful, and interesting and all, there, Real Reality, but has very little bearing to the rental situation for people like us - ie non-executive, non-military folks, those idiots who are paying the thousands of dollars per month asked by all the realtors who advertise in the Korea Times/Herald - especially those of us with Korean spouses. With regard to the last links - never never trust a real estate agent, especially in Korea, to give you the straight dope. Relo-Korea sserves the corporate/army relocation market, something which is stupidly expensive (and doubly so in Seoul) no matter where you go in the world, primarily because large corps and goverment departments hemorrhage money senselessly. I've been there, and would only consider using the services of a relocation specialist if my company were paying. English teachers aren't in that league.

Brendan - don't panic. There's tons of places out there, and affordable, if you have a few grand to spare for key money. Once again, see my post in the other thread for my (recent) experiences.

[just because]

I think if you own your own apartment the hagwon will give you compensation, I'm aware its about 300 to 400 000 won a month. saves the director putting up key money for a another apartment, right.

[BTM]

[kimcheeking]

My sister-in-law, who runs a budong-san, gave us advice when apartment looking. She said to avoid small real-estate agents, and ones run by ederly people as they are most likely to be the crooks. This was advice from a korean to another korean (related) so all who are looking for an apart take note of this.

Just follow commen sense. If you get a bad feeling leave.