Real Estate and Relocation Co.

Guide for Living in Korea

Housing Culture

01 Types of Residences

In Korea, typical types of residences are detached houses, apartments, studios (called 'officetels' inKorea), multiplex houses, and multi-household houses (etc.). These days Koreans who live in citiesprefer to live in multi-unit dwellings, such as apartments, for the sake of convenience. Koreansplace great importance on housing. In Korea, the price of housing is very expensive, and houses inmetropolitan areas are far more expensive than those in rural areas.

02 Buying a House and Rental Contracts

(1) Buying a House

When you buy a house, there are many things to consider: the house’s location, the direction it faces,transportation, surrounding environment, etc. Once you decide to buy a house, you must get acertified copy of a real estate register to check ownership, mortgage loans, etc., so there won't be anyunpleasant surprises after the contract is finalized. Finally, when you sign a housing contract, you mustmake sure that everything is written correctly and in detail.

(2) Lease on a Deposit Basis

Korea has a unique housing rental system. Before moving into a house, tenants usually pay a largesum to the landlord. When the rental period ends, the deposit is returned to the tenant in full (minusany damages). Typically, you can rent a whole house, or only part of a house (1 floor, 1-2 rooms, etc.).If you want to rent a whole house, the deposit is usually 40-80% of the value of the house. Rentalcontracts are usually made for 2 years (for officetels, 1 year), and by law the landlord cannot terminatethe contract before the end of the two-year period if the tenant wishes to stay until the end of thecontract. In fact, a tenant has the right to stay in a house for 2 years even under a 1-year contractpursuant to the Housing Lease Protection Act.

(3) Banjeonse (Half Deposit System)

With the recession in the housing market and the current trend of lower interest rates, leaseholdersin Korea have recently been shifting their lease system from the previous jeonse (deposit system) toone of banjeonse (half deposit system), in which a deposit is combined with a monthly rent to secureprofitability for the owner. Today, three out of ten houses are leased under the half deposit system.To calculate the rent for their properties, leaseholders use the average monthly interest (200% ofthe interest rates at banks) accrued by the deposit. For example, assuming that under higher interestrates, the deposit money would increase from KRW 300 million to KRW 400 million over two years,leaseholders now divide this increase of KRW 100 million into a monthly rent of KRW 400,000 to KRW600,000, and offer their properties for the deposit money of KRW 300 million and a monthly rent ofKRW 400,000 to KRW 600,000.

Security Insurance System of House Rental Security Deposit Return

In case the security deposit is not returned, tenants are advised to take out the Security InsuranceSystem of House Rental Security Deposit Return issued by the Korea Housing & Urban GuaranteeCorporation (HUG / www.khug.or.kr).

(4) Wolse (Monthly Rent)

You can also get accommodations on a monthly rent basis. You will still have to pay a small deposit,much smaller than that of a lease, but you will have the advantage of being able to negotiate thedeposit depending on the period of your contract. If you can afford a higher monthly rent amount, thedeposit can be smaller, and vice versa. Wolse conditions depend on the size and number of rooms, andother facilities.
Neither a lease nor a monthly rent arrangement will include the cost of utilities. You have to preparefurniture and home appliances separately, but many multiplex houses and officetels are equipped withbasic home appliances such as a refrigerator, washing machine, etc.

kkalse

There are some landlords that ask foreigners residing in Korea or multicultural families to do "kkalse,"which is a lump sum payment of 1-3 years' worth of rent. A rent system called Yeonse, with a paymentof a whole year worth of rent, has been common in Jeju area for a long time.

(5) Gisuksa (Dormitory)

A gisuksa is a residence offered by a company or school. For foreign investment technology trainees(D-3), and workers who enter into Korea via the Employment Permit System with non-professionalemployment visas (E-9), some companies may provide dormitories, but they are not obligated to do so.

(6) Checklist When Looking for Housing

There are many ways to search for a house in Korea. Although using fliers on the street and visitingadvertised places in person is one method, the most common method is to use a real estate agency.If you use a real estate agency, an agent will find housing that meets your qualifications and preparenecessary documents for you. By going through a real estate agent, you will be able to make a safercontract and avoid any future legal problems. Real estate agents charge a commission fee based onthe house price, so it is advisable to check the brokerage fee on the Internet in advance.

  • Currently, most real estate brokerage fees are based on the value of the transaction. If a real estate agent claims an excessively high fee, you should report it to an illegal brokerage activity report center.

(7) Contracts

Contract Counterpart

Rental contracts must be made with the actual owner of house. In the contract, the lease period,deposit amount, monthly rent amount, and other important information must be specified. In the caseof subletting or taking over a contract from a previous tenant, be cautious of giving large deposits.Since you are not making a contract directly with the owners, the owner is not obligated to give youyour deposit back if he/she does not agree with the contract.
Before entering into a contract, it is imperative that you check the identity of house owner, and checkthe required documents of the owner or the owner’s official representative (authentication certificateof one’s seal, letter of delegation). The identity of a house owner can be verified by examining acertified copy of the person’s real estate register, which can be easily obtained on the Internet. It isgood to check the real estate register several times throughout the process: before making your downpayment, interim payment, and final payment.

Register

Checking the real estate register before entering into a contract is just as important as seeing the housein person. The register contains the address of the house, the name of the landlord, and the totalarea and other structural details, and also gives information regarding whether the landlord owns thebuilding outright or is paying a mortgage. A certified copy of the register can easily be issued online atwww.iros.go.kr without visiting the registry office. Since this is an extremely important part of the houserental process, be sure to ask a Korean friend or colleague for assistance if you are unable to access theregister yourself.

Down Payment and Deposit

A down payment is not required by law, but people typically pay 10% of the total deposit as a typeof placeholder to prevent someone else from claiming the house. For example, if the total deposit is 2million won, then the down payment would be 200 thousand won. The remainder of the deposit, 1.8million won, would then be paid on an agreed date before moving in. Full payment must be madebefore or on the move-in date. Make sure to keep all receipts.

Items to be included in a rental contract
  • Address of the rental unit
    (The address on the contract should match the one on the register.)
  • Contract payment (Deposit and monthly rent)
  • Due dates for the down payment and the balance payment(s)
    (It is safe to pay up to 10% of the deposit as a down payment.)
  • Term
  • Signatures or thumbmarks of the landlord and the tenant

(8) Termination of Contract and Deposit Refund

If a tenant decides to move out before the contract period ends, the house owner can deduct theamount of the upcoming monthly rents (up until the expiration date) from the total deposit and thenreturn the rest.
For example, let’s say that you live in a room with a KRW 2 million deposit and a monthly rent of KRW150,000 and you decide to move to another place 3 months before the end of your housing contract. Ifanother tenant moves in right away, the landlord would not subtract any money from your deposit. If thelandlord is not able to find a new tenant, it is completely legal for the house owner to return only KRW 1.55million to you, subtracting 3 months’ rent of KRW 450,000 (150,000 x 3 months) from your deposit.
If you do not wish to renew your contract, you should give notice (to your landlord) at least onemonth before the end of your contract. If you have given advanced notice, it is illegal for your landlordto withhold your deposit. If your landlord wrongfully withholds your deposit, you can seek redressthrough a civil action. This may take some time and requires some complex procedures. Should such asituation occur, there are various support centers from which you can seek help.before the end of yourcontract. If you have given advanced notice, it is illegal for your landlord to withhold your deposit. Ifyour landlord wrongfully withholds your deposit, you can seek redress through a civil action. However, thismay take some time and requires some complex procedures. Should such a situation occur, it is advisable toseek legal assistance by contacting the Korea Legal Aid Corporation (KLAC) / www.klac.or.kr).

Things to do a month prior to moving out

At least one month before your contract expires, you must tell your landlord whether youintend to leave on the date your contract expires, or wish to stay longer. If you do not discussthis with your landlord, your contract is automatically renewed, and you may lose the chanceto move out when you want to. Many people forget and make this mistake.

Advantages and Disadvantages of Real Estate Direct Transactions
What to know when engaging in direct transaction

There are some multicultural families who favor real estate direct transaction to save cost. Althoughthis transaction can save cost, there are various risks. In general, the person releasing an article forsale reveals personal information including address and phone number. Still, it is best for a womanliving alone not to reveal her personal information. Persons who visit the real estate do not comewith a licensed real estate agent or a broker, so the person releasing the article for sale may beexposed to unexpected crimes. When trading through a real estate broker, the broker is required toinspect damages in the house and explain this to the prospective tenant. In contrast, the prospectivetenant must check for flaws on his/her own during a direct transaction. Thorough inspection isrequired to make sure that there are no issues with equipment or finishing material of the house.Even for a direct transaction, a person may generally entrust a broker with designing a contract foraround KRW 100,000. Still, this does not mean that real estate brokerage has taken place. It is aform of a "scrivener service,” so the broker is not responsible for the trade at all.

Use a brokerage agency as a safer alternative to direct transaction

Although there were only 50 direct transaction cafes in 2009, there are now over 100 directtransaction cafes and 1.1 million members. The number increased by more than two-fold amid thedepression of the real estate market. The real estate industry estimates that there are more than100,000 real estate offerings per month, with information distributed through Internet channelssuch as cafes and direct transaction websites. Direct transaction of leases on a deposit basis andmonthly rent has become popular because there is now ample information on real estate offeringsthat can be searched on the Internet. In the past, real estate offerings posted on the Internet's directtransaction market were limited to studios and officetels. Most users were college students or officeworkers living alone. Recently, however, articles for direct transactions have significantly expanded to2-3 room multifamily houses, detached houses, and apartments for rent and even to officetels, urbanliving homes, shopping centers, and offices. Although real estate direct transaction may provide costreduction and convenience, it may pose risks for those who are socially inexperienced or inexperiencedwith contracts. Therefore, utilizing a licensed brokerage agency is recommended because the range ofdamage pattern is gradually becoming more diverse, i.e., houses that were put up for auctions havebeen offered as direct transaction articles, and some tenants have fraudulently offered secondary leases(double contracts). In particular, direct transaction for monthly leases and leases on a deposit basis is adirect contract between two trading parties without a certified broker; therefore, a person may incursignificant loss if he/she does not thoroughly check all clauses and procedures. A large proportion ofvictims are social rookies or those unfamiliar with real estate procedures. A person who is familiar withInternet open market trade but lacks basic knowledge of real estate trade often searches for cheapofferings and engages in direct transaction. As a result, he/she may sign a contract with a person whoclaims to be a landlord or experience difficulty with clear repair when moving out later. Moreover,many sign the contract without knowing the exact market price of the rent, so they may sign thecontract at a price higher than the market price. Therefore, all things considered, the safest thing is toutilize a licensed brokerage agency. In this case, even if a person is victimized with a double contract,he/she may be protected under fraternal insurance. In addition, there are other advantages of tradingthrough a licensed brokerage agency. Keep in mind that although direct transaction may save on thecost of brokerage fees, it may require more time and money later due to unfavorable outcomes.

03 Special Housing Assistance Program

Under the special housing assistance program, multicultural families will be given preferential treatment in applications for housing without having to compete with general applicants.

(1) Eligibility

  • In accordance with Article 2 of the Multicultural Family Support Act, a multicultural household member must have lived at the same address as his/her spouse for three years or more.
  • Applicants as well as other household members should be non-homeowners.
  • Applicants need to open a bank account to apply for apartments. Six months must have passed since opening the account, and monthly payments must have been made more than six times on the fixed date.

(2) Application method

  • Apply to the relevant apartment supplier on the date of subscription.
  • Subscription notices appear in daily newspapers, websites of local autonomous bodies and also on www.applyhome.co.kr
What is a housing subscription?

The Housing Sale Regulations refer to the Korean housing subscription system that entitlesthose meeting certain requirements to subscribe for an apartment through a subscriptiondeposit. Houses for installment sale are classified as a national housing, a private house and amedium-sized national housing. The subscribers wishing to buy a house are required to open asubscription-related deposit such as subscription deposit, subscription installment, and housingsubscription. The pre-sale is selected by the sequential system to select a tenant in descendingorder of the periods of being a household without house ownership, the number of paymentsmade for subscription deposit, and total savings; by the housing subscription merit system toselect a tenant in ascending order of the sum of the additional points and deducted pointscalculated based on certain criteria; and the lottery system.

04 Electricity

(1) 220 Voltage

Most houses in Korea use 220-volt electricity. If youwant to use a 110-volt appliance, you will need atransformer to convert from 220 volts to 110 volts.

  • Contact number for Korea Electric Power Corporation, ☎123 (www.kepco.co.kr)

(2) Earth Leakage Circuit Breaker

Every house has an earth leakage circuit breaker to prevent the risk of fire due to leakage of electricity.When too much electricity flows in or a problem occurs in the flow of electricity, the circuit breaker willautomatically switch off the flow. If the breaker is not working properly, it may pose a safety risk. Makesure to check that it is working properly before moving in. To check a circuit breaker, simply press thetest button (usually a red button). Pressing the test button should cause the switch lever to go down. Ifit does not, the breaker is broken.

05 Use of Water

In winter, there is a risk of water supply pipes freezing. The following can help prevent this problem.

  • Check for leaks around the water meter, and make sure the water meter is wrapped with proper heat insulation material (e.g. Styrofoam). If you notice any problems or abnormalities, it is important to report it and have it fixed right away.
  • If the water meter is exposed, as in aisle-type apartments and townhouses, protect the meter by covering the top with vinyl or wrapping it in hot wires. If you plan on leaving your house for an extended period of time, turn on the tap so that the water drips slightly to prevent your pipes from freezing.
  • If the water meter is frozen, melt the ice with warm water first and then with hot water, to prevent the glass cover of the meter from cracking.

06 Use of Gas

(1) Cooking Gas (LPG and city gas)

Turn on the gas valve to start cooking on a gas stove. Make sure to turn it off after using gas. It isimperative to conduct a safety check when using LPG gas and city gas. To see if the gas leaks, mixwater with dish soap to 1:1 ratio and brush the mixture onto the connected parts of the gas hose. Ifbubbles occur, it means the gas is leaking and thus needs to be repaired immediately. Gas companiesmake safety visits to homes that use city gas every six month (every month for gas consumptionmeasurement). It is advised to stay home on the day of inspection so that the proper inspection can becarried out. Misuse of cooking gas can lead to big incidents. Always double-check to make sure thatthe pilot light is out after you finish cooking and get into the habit of locking the intermediate stopvalve when the gas is not in use.

(2) Butane Gas

Butane gas canes are used for portable gas burners. If a can is put in the wrong way, it may result in afire or a gas leak. When disposing of a used butane gas can, puncture a hole in the can with a nail oran awl in a well-ventilated outdoor area before putting it in the recycle bin.s

(3) Prevention of Gas-Related Accidents

Most gas-related accidents are the result of gas leaks due to thecareless management of gas facilities. The most common gas-relateddeaths are those that result from explosions and those that lead toasphyxiation. If a gas leakage is detected through a safety check, thefollowing actions should be taken immediately.

  • Close the gas valve.
  • Open the windows and the doors for ventilation
  • Turn off any electronic devices, because sparks may cause a gas explosion.
  • Contact your gas provider to request a safety check.

07 Heating

Most houses are equipped with heating facilities where hot water pipes are installed under the floor so that hot water is supplied and circulated to heat the house.

(1) Boiler

Boilers may be run by briquettes, oil, LPG or LNG city gas. Boilers using briquettes are cheap but shouldbe checked every couple of hours due to safety concerns. Oil and LPG-run boilers are expensive andneed to be refilled every few weeks. LNG city gas is cheap and has a continual supply that runs througha pipe. It can be used for both cooking and heating. It is recommended to look for a place where LNGcity gas can be supplied. The rent for such a place could be more expensive than others, but it is worththe money considering how much you will save on your heating bill.

(2) Electric Heaters and Electric Mattresses

Electric heaters and heating pads are commonly used in the middle of winter. Note, however, that theymay significantly raise your electricity bill and emit electromagnetic waves. Therefore, be sure to usethem in moderation. Also, excessive or improper use can be a fire hazard.

(3) Gas Heater

Gas heaters are commonly used indoors but need proper ventilation. Sleeping with a gas heater oncan lead to asphyxiation. Proper ventilation is a must.

08 Telecommunications

(1) Telephone

You can call 100 (KT), 106 (SK broadband) anywhere in the nation to request for installation. Dialone of the aforementioned companies to be connected to a corresponding call center. When settingup your phone, the most convenient payment options are automatic withdrawal or online paymentthrough Giro (www.giro.or.kr, ☎1577-5500). By using one of these methods, you can pay your phonebill without having to visit the bank.

  • SK broadband : Call 106 (no area code needed). Representatives will answer in Korean, but can put you in contact with an English or Chinese-speaking representative.
  • KT : Call 100 (no area code needed). Representatives will answer in Korean. For service in English, Chinese, or Japanese, call the Foreigner Service Center at 1588-8448 (no area code required).

(2) Mobile Phone (usually called 'Hand Phone' in Korean)

Month-to-month plans for expensive phone models are not typically available to non-Korean citizens.Some foreigners find it easier to buy pre-prepaid phones. In order to get a phone number issued toyou, you must present your alien registration card.

Major mobile phone operators

If you do not have an alien registration card, you can still use the pre-paid phone service called, "cardphone." This service has no registration or hidden fees, but rates are slightly higher than other mobilephone services. Through this service, you can recharge your phone with pre-paid phone cards (availablein various amounts starting from 10,000 won).
Phone cards can be purchased in many stores, foreign food markets, post offices (may differ by region,contact ☎1588-1300), or authorized telecommunication stores.

Useful Information
Ad Calls/Ad Messages

Mobile phone carriers get a lot of spam calls and messages. Try to ignore messages from people youdon’t know. Calling or responding to these spam messages can lead to excessive service chargesand other damages. This is especially true if you respond to commercial messages containing adultcontents.

Area Codes

There are 17 area codes in Korea. The area code of the destination you are calling should be enteredbefore the phone number you are about to call. Area codes are not needed for calls made withinthe same area.

Area Codes
AreaNumberAreaNumberAreaNumberAreaNumber
Seoul02Daejeon042Chungbuk043Gyeongnam055
Busan051Ulsan052Chungnam041Jeju064
Daegu053Daegu044Jeonbuk063
Incheon032Gyeonggi031Jeonnam061
Gwangju062Gangwon033Gyeongbuk054

(3) Pay Phones

To use a public phone, you need coins or a prepaid phone card. If you are mindful of time zonesand daytime/nighttime minutes, you can even make economic international calls. The tariff for localtelephone calls is 70 won per 180 seconds, and the tariff for long-distance calls is 70 won per 38seconds.

(4) Emergency Calls / Collect Calls

Every pay phone has a red emergency call button. You can make a police report or fire report bypressing the red button followed by a service number. Emergency calls can be made without any coinsor phone cards. Remember the following two numbers in case of emergency.

Police : Emergency button + 112, Fire department : Emergency button + 119

When you have to make a call to other numbersand you don't have any money with you, trythe collect call service. Collect calls are chargedto your recipient using slightly higher rates thannon-collect calls. For domestic usage, press'emergency button + 1541 + the other party'stelephone number+ #'.

(5) International Calls

In order to make an international call from a pay phone, it is best to buy a phone card on the Internet, or at a foreign grocery store or convenience store.

Korea > Overseas
  • Using a landline
    • When calling from Korea to a home or an office in LA (USA) with the telephone number, 123-4567
    • International service number
    • International code (USA) 1
    • Area code (LA) 213
    • Telephone number 123-4567
  • Using a mobile phone, Internet call
    • When calling from Korea to LA (USA) from a mobile phone number, 010-123-4567
    • International service number
    • International code (Japan) 81
    • Telephone number 80-123-4567
Overseas > Korea
  • Using a landline
    • When calling from overseas to a home or an office in Korea with the telephone number, 123-4567
    • International service number
    • International code (South Korea) 82
    • Area code (Seoul) 2
    • Telephone number 123-4567
  • Using a landline
    • When calling from overseas to a person in Korea with the mobile phone number, 010-123-4567
    • International service number
    • International code (South Korea) 82
    • Telephone number 10-123-4567
  • If the area code of the number called begins with a “0”, the “0” is omitted when making an international call.
Useful Information
How to Use International Call Services

International calls, or calls between countries, are much more expensive than domestic calls. Youcan save money by making international calls during discounted times, which are usually duringevenings and holidays. It is recommended to check charges in advance, as rates vary by country andby service provider.
Nowadays, smartphone applications with free international call functions are available for download.

International code
CountryCountry CodeCountryCountry CodeCountryCountry CodeCountryCountry Code
Nigeria234Vietnam84Iraq964Kyrgyzstan996
Nepal977Brazil55Iran98Thailand66
Germany49Sudan249Egypt20Turkey90
Laos856Sri Lanka94India91Pakistan92
Russia7Syria963Indonesia62Peru51
Malaysia60Singapore65Japan81Philippines63
Mexico52Argentina54China86Australia61
Mongolia976Angola244Chile56Hong Kong852
America, Canada1England44Kazakhstan7
Myanmar95Ecuador593Cambodia855
Bangladesh880Uzbekistan998Colombia57

(6) Cable TV and Internet

In Korea, diverse kinds of broadcast channels are provided via general service broadcasts, cable TV,regional cable broadcasts, satellite broadcast (Sky Life), as well as terrestrial broadcasts (KBS, MBC, andSBS). Recently, internet-based pay TV (called ‘IPTV’) has become quite popular. Some regional cableTV or IPTV companies provide bundled services with high-speed Internet. If you sign up for bundledservices (TV and Internet), you can use both services at a lower rate.
If you are interested in getting an Internet connection only, compare the services and rates offeredby each telecommunications service provider. If you cannot afford a personal Internet connection athome, the many conveniently located PC rooms offer an economical alternative. PC rooms are open24 hours and typically cost 1,500 won to 2,000 won an hour (varies by region).

09 Garbage Collection System

Garbage is separated by type and collected at certain days and times. It is important to separate anddiscard your garbage according to the guidelines in your district. Garbage is usually collected early inthe morning, so it is best to put your garbage out after 10 pm the night before.

(1) General Waste

Put your garbage in a bag specially designed for general waste, excluding food remains and recyclables.

Useful Information
Standardized garbage bag

You can buy garbage bags at nearby supermarkets, conveniencestores, or discount stores. Colors of garbage bags for generaland food wastes are different by district, so you have to checkthe colors before you purchase. Bags for general waste havedifferent volumes: 1, 2, 5, 10, 20, 30, 50, 60, 75, and 100 liters;the availability of bags may differ by store. Ten and 20L bags arethe most common for household use. Food garbage bags comein 2 to 5 liters and are disposed of every few days. Some villagesuse a container to collect food remains. Ask your neighbors fordetails.

(2) Food Remains

Food waste should be strained to removed excess liquid and disposed of in a food waste bag or put inthe neighborhood disposable food waste container (varies by region). RFID- and volume-based foodwaste treatment charging systems are operated by each local government.

(3) Recyclables

Recyclables include paper, bottles, steel, cans, vinyl, packaging bags (with a triangular recyclable markfor separate disposal with PP, OTHER, LDPE, etc., and plastics [PET bottles, expanded polystyrene (EPS),packing materials (polystyrene), other synthetic resin packings (yogurt bottles, detergent containers,etc.)]. Plastic bottles and cans should be dried and flattened before being discarded.

(4) Large-sized Materials

To dispose of large items such as worn-out furniture or out-of-order electronics, you must buy asticker from your dong's community center, attach it to the item you are discarding, and place theitem outside for take-away. Sticker prices differ depending on the size and type of the item. Somedesignated stores (supermarket, etc.) sell stickers also, depending on the region. Some apartmentcomplexes will take care of these types of items for you for a small fee.

Discharge report via Internet: you can purchase a sticker via the Internet
(at district office homepage).
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