Korean Job Discussion Forums

[Derrek]

What information or tips can some of you older, wiser people give about buying a home in Korea. Or perhaps once you marry. Do people put it in their wife's name? Can foreigners buy it themselves? Can we get loans easily? Are certain banks more accepting?

Thanks!

[JongnoGuru]

Several of us have taken advantage of the following relaxed restrictions on foreigners buying/owning property in Korea.

(From KOTRA's website)
In terms of restrictions on the purchase of property or use of property, the real estate market was completely deregulated in June of 1998 and foreigners can now purchase land on the same basis as local residents without any limitations on the size or use of land. There are also no longer restrictions on the purchase of land by a foreign invested company for non-business purposes.

(I wonder if this is still true of the PI)
In contrast to the Philippines and China, which do not give foreigners the right to purchase property, Korea has almost no restrictions on the purchase or use of land/buildings by foreigners and the property market is open to foreign investment.

So, there's the Korean government's own answer to your question whether foreigners can buy property themselves (yes), or whether it must be in a Korean spouse's name (no). And I can personally vouch for it as well, as can friends and acquaintances of mine.

Nearly every foreigner I personally know who is married to a Korean and who has purchased property here since June 1998 did so in their Korean spouse's name. This wasn't necessary, and it's not clear to me that all of them understood that. Oh, most of them discussed their initial plans of registering it in their own name, or in some sort of joint-ownership arrangement that they assumed was just as common in Korea as it is in the West (which it is not).

But in every case -- even those where the foreigner provided 100% of the funds -- they relented or became confused or got cold feet, and the property always ended up being solely in the Korean's name.

Now, it's always heart-warming when a couple can place enormous faith in the strength and longevity of their marriage. But these foreigners (husbands for the most part) are putting a measure of trust in theirs that would seem foolhardy in their own countries. Divorce rates today in general, and those for interracial marriages in particular, being what they are, I can only wish them the very, very best.

As a result, the only foreigners I know who own real estate in Korea in their own name are: single; married to another foreigner; or married to a Korean now, but purchased their property while they were single.

More about bank loans next time.

[chiaa]

Tell us about the bank loans!


Please

[JongnoGuru]

Sorry... forgot all about this. You should have PM-ed me, Chiaa. It's not like this thread's just burning up the boards, is it?

I'm really no expert, and I wish other posters would chip in with their own thoughts, experiences or questions.

Anyway, let's see if I can say something here about bank loans that's so provocative, so incendiary, that the JoongAng Ilbo sees fit to write it up, prompting the K-nutizens to rush the Cafe, and Mr. S yanks this thread and bans all future talk of us big-noses buying real estate in Korea!

"Tell us about bank loans!"... Okay, we're discussing home loans, not other types of consumer credit, auto financing, etc. And what you're wanting to know is: "Can I, the average foreigner, walk into a bank here, fill out an application for a home loan, and expect my chances of getting one will be just as good as the average Korean's?"

I won't say "No, never", because there's a first time for everything. But generally, it isn't going to work that way. The constitution of the Republic may say you can't be discriminated against based on your race or nationality (not sure that it does, however), but it is policy -- internal or government-- not the constitution, that banks look to when making day-to-day loan decisions. And according to policy governing loan decisions, foreigners are typically at an automatic disadvantage vis-a-vis people with surnames like Kim, Lee, Park, Choi, Shin...generally speaking.

When a foreigner asks for a loan, a bank is going to have the same misgivings as a credit-card issuer, a mobile phone vendor, and (sorry Derrek) some video rental shops. We all know that foreigners are usually required to put up an additional deposit for these relatively small-ticket items. With home loans, of course, we're in a whole different galaxy of risk, and this is where your foreigner status and your visa become obstacles.

Remember, although it's stamped in your passport, that visa isn't really yours to extend or renew as you see fit, but rather it is extended, renewed, or revoked at the whim of, firstly, an employer, and ultimately a bureau within the Ministry of Justice -- none of whom give a whit about any financial relationship or obligation you might have with a Korean bank.

Banks know this, and they know you're potentially one visa violation -- one pissed-off employer with a grudge and a brother-in-law at Immigration -- away from being deported... and effectively slipping outside the bank's reach. Or, you might simply abscond overseas, and banks would worry about that possibility, too.

Yes, yes, it's quite true that a handful of Koreans have done exactly that: taken out big bank loans and then fled the country. And banks are scrambling to minimise the risk of that happening. But you'll understand that's hardly a compelling argument, from the banks' position, for doling out loans to foreigners who might do the same thing!

Ran out of time. More later. Specific questions, anyone?

[funplanet]

I bought my place a year ago with no problems....get a good realtor and learn all you can about it...my gf helped me do all the paperwork and running around...

more complicated than in the states but not bad at all....

paid all up front so no bank loans though my bank was willing to finance 50% (cause I'm a foreigner I guess)

good news...25% increase in property value

[Wangja]

[JongnoGuru]

[Wangja]

Oh, forgot to mention, I did buy some property about 18 months ago, but paid cash and do not know what the loan position would have been.

[JongnoGuru]

[Hollywoodaction]

[kimchikowboy]

If you buy a new apartment, keep in mind that windows are not included.

[Hollywoodaction]

[Wangja]

Foreigners' land purchases in Seoul slow

Foreigners' land acquisition in Seoul slowed for the first time in five years to increase by just 133,980 square meters in 2004, suggesting Korea's depressed real estate market dampened their investment sentiment.

http://www.koreaherald.co.kr/SITE/data/html_dir/2005/01/22/200501220041.asp

[kimchikowboy]

Hollywoodaction wrote:

[Hollywoodaction]

By saying cheaper, I meant smaller. It's quite possible that ours were thrown in for free because we bought the place in a given amount of time, but all of the apt. in our building already had the veranda windows installed before we bought ours.