Korean Job Discussion Forums

macaronique · Joined: 14 Nov 2007

I am going to be a newbie in July, if my employer offers key money and a housing allowance. Could I use the full amount of the key money to negotiate a lower rent? E.G. I have been looking at rents online for Gangnam are .6 mil with 2 mil deposit. If I can offer a 8mil deposit will that decrease rent?

PokerZero · Joined: 30 Apr 2006 Location: theultimatetrek.com/forum

I've no experience of this so I may be wrong but I don't think that a bigger deposit will reduce the rent unfortunately.

The key money/rent you are looking at does seem quite cheap though, a friend of mine has recently moved to Gangnam and he told me he paid 10mill in Key money and pays 800,000 a month in rent. From what he has told me the apartment is nothing special but he does have a great location so it may be the exception rather than the norm.

doc_ido · Joined: 03 Sep 2007

I (or rather my excellent Korean TA) negotiated lower monthly rent - I think I paid something like 2-4 million extra key money and 50,000 less rent. However, it probably depends on the landlord/lady and I live in a slightly less desirable area (Sinchon).

PRagic · Joined: 24 Feb 2006

For every extra million won you put down in key money, your rent should decrease about 100 thousand won. If you put down 8 million on that place, you should be rent free.

For that much, though, it can't be too nice of a place or too big. Sounds like a small one roomer. If that is OK with you, cool. However, a lot of times the owners of smaller one-room buildings prefer to get the monthly rent.

Places that take full key money usually don't own the building outright yet, so they need the funds to pay back the previous owner and/or the bank. If you do pay it all in key money up front, but SURE that the building doesn't have any leans on it. If for any reason the owner goes belly up, there's a good chance you'll be out your key money.

nobbyken · Joined: 07 Jun 2006 Location: Yongin ^^

PRagic · Joined: 24 Feb 2006

The system is the same all over Seoul and elsewhere. If his rent was 600 a month with 2 million down, and he paid another 6 million down, he'd be on full key money paying no monthly rent.

But Kangnam is expensive, as are many places in Kangbuk (some moreso than Kangnam!), which is why I said that the place the OP is looking at can't be too great. I lived in Kangnam in 1995 in a 12 pyung one-room, and that was 10 million down and 700 a month!

pkang0202 · Joined: 09 Mar 2007

There is 2 types to rent:

1. Jeon-se (key money). You pay an insanely high deposit but you don't pay any rent monthly.

2. Wol-se (rent). You pay a deposit (bo jung gum) and you pay monthly rent. Some places will let you put down MORE bo jung gum so that you can have lower rent.

You have to negotiate with each place about how you want to live. Some places will NOT take Wol-se, no matter what. Others will not adjust bo jung gum.

Generally, bo jung gum will go like this:

500/50
(500 X 10,000w) bo jung gum and 50 X 10,000w wol-se

The first number is deposit, the 2nd is the monthly rent.

Scouse Mouse · Joined: 07 Jan 2007 Location: Cloud #9

loose_ends · Joined: 23 Jul 2007

Chris Kwon · Joined: 23 Jan 2008 Location: North Korea

Living rent free? What???

prairieboy · Joined: 14 Sep 2003 Location: The batcave.

Generally, for every extra 1mil you put down in key money at the beginning, your rent should decrease by 10,000 per month.

If you have found 200/60 (2 mill down and 600,000 every month) and the owner allows you to put down 8 mill, your monthly rent would be 540,000 instead of 600,000.

In terms of saving money on your monthly expenses, it's better to put down as much as the owner will allow as key money.

If you look outside of Gangnam (like Gwanak or the west side of Seocho) you can probably find something cheaper, but you'll be commuting.

Cheers

macaronique · Joined: 14 Nov 2007

This has totally been untrue since I got here I was looking for a place in Gangnam and my friend looking in Shinchon. 10 million key money was not even a bargaining tool We both have gotten temporary housing to look around more. I love my job for sure, but free housing looks so much more appealing now in order to save money. I guess you live and learn.

loose_ends · Joined: 23 Jul 2007

macaronique · Joined: 14 Nov 2007

Yeah option 2 would be awesome and I don't even need that much space 1 or 2 rooms would be cool. Think that is available in hongda, shinchon ,or eiwa univ. or will it just be a search to find it. I can commute for a sweet deal. Plus I have friends there

loose_ends · Joined: 23 Jul 2007