Korean Job Discussion Forums

[Fox]

The gloom and doom about where the 전세 system is going seems on the mark to me. 전세 only really makes sense as an aspect of a culture of savings anyway, and now that Koreans are shifting ever more strongly towards a culture of debt, it really doesn't make sense.

For those who do want to buy, here's a useful website.

[PRagic]

That's why the K government passed those most recent measures. Also, a on the quiet, the word went out that if you fork over a huge amount of chunsae, you'll get audited. No joke. Everything has been stacked to prod the buyer-seller market forward.

The downside? Untenable levels of debt and artificially deflated interest rates.

[atwood]

[PRagic]

If you've been here a while, have gotten married, had kids and/or simply just accumulated too much crap, then 100million won't get you anything near big enough, at least not in Seoul.

A few years back when we had to move (had chunsae and the owner sold), there wasn't much on the market. Our place was definitely NOT nice in almost all respects, but it was still 250million for chunsae, and we were happy to get that for that amount. The place we got the boot from was 340million. Eeeek.

Our big worry is that chunsae is going the way of the dinasaur, and rent on a three bedroom in a hood we'd like will run about 3 million/month. That's a kick in the nut-sack when you're used to just losing interest income! Guess we'll just cross that bride when we get there. Maybe there'll be bubble pop and we'll be able to pick up decent place on the cheap, some place with a little land. Dream on...yeah...I know...

[Lucas]

[edwardcatflap]

[PRagic]

Good deal. Hope the paper is clean on the place if you've 400 in, but you've probably done all that due dilligence. Odd that they'd quote such a low rent, though. If the chusae is 400, then the rent quoted would normally be 4 million/month.

We like the Hapjeong/Hongdae area and have always lived around there. Would be open to a more central city location if it were a decent commute, though. Depends on the hood.

[goreality]

[PRagic]

First off, that's why I asked whether or not the 'paper was clean'. You can make sure that there are no debts or leans on a property before plunking down your chunsae. If there is a lean/debt, then there's a pecking order so you then have to weigh your risk.

The bank is always first. If you're in a building, the first people to have moved in will be the first to get paid out if the property goes bust and gets auctioned off (assuming, of course that there'll be anything left over!). The last person to rent in the building will be on the wrong end of the shiite shovel.

I kind of understand why the rent stated was a lot lower than the 10% usually charged up until a year or so ago. Rents have fallen as people simply couldn't affort those lofty sums. Now, it's more common for rent to be 4%-6% of a lump chunsae amount. Think you still have to pony up on the pojeumgum, though (down payment).

Unfortunately, no matter your form of payment, you don't get much for your money here. This is why everyone I know likes working and banking here, but spends every break elsewhere and has absolutely zero intention of retiring here. They'll retire FROM a K place of work, sure, but they won't retire IN Korea.

[PRagic]

...and it was 400 million WON, not dollars. Pretty big difference lol...

[motiontodismiss]

The bubble will pop when either the FRB or inflation forces the Bank of Korea to raise interest rates (most likely the former) and the banks start telling their borrowers to make payments toward their principal.

Some people in Korea don't seem to get that jeonse is the equivalent of a home equity loan where the lender gets to live in the home rent-free instead of interest. This means that household debt is a lot worse than what government statistics seem to indicate.

One more thing, the population of people between the ages of 15-64 hit a peak in 2012 in Korea and the boomers are retiring en masse soon. This same peak for the US was in 2007 or sth and in Japan, 1989 or thereabouts. THAT's when all hell will break loose and people with cash will win.

There are more homes in this country(not including "home-equivalents" such as officetels and the like) than there are households and with the birth rate at 1.19, it's only a matter of time.

Jeonse is still cheaper than rent (even if the latter went down A LOT), so go with a place with no debt on it, register your lease agreement at your local dong office, and insure your deposit with the Housing Finance Corporation or Seoul Guarantee Insurance. For a 100 million won deposit, the premium's like 20k won a month. If HF or SGIC refuse to insure it, find somewhere else to live.

That said, jeonse isn't going up and rent's going down in Bundang. It's a great thing.

[PRagic]

The problem is that it's getting harder and harder to find decent chunsae places with clean paper. Owners without debt or liens increasingly want monthly rent, and who can blame them?

[Stan Rogers]

One thing to keep in mind is that there will always be a market for new places. Location is also important too.

I don't see interest rates going up anytime soon.

[Stan Rogers]

Something else that has started going on is people who buy a new place but don't live in the apartment and refuse to rent it out as well. They purchase an apartment as an investment and hope to sell it at a premium becasue it has never been lived in.

Just because many places in a building are empty doesn't mean they aren't paid for or unsold.

[PRagic]

That's why you have mobs of people trying to buy in at the 'time-of-build' initial price. Funny, but in instances when the price has then FALLEN, all those greedy bastards who we're looking to price gouge any other would be buyer go crying and bitching to the government that they were cheated.