Types of contracts
There are two main kinds of contracts in South Korea:
- jeonsei and
A “ jeonsei” contract means “paid in full” which requires that the tenant pays a specified sum of money to the owner or landlord (usually 30-80% of the cost to rent the property). Two-thirds of all housing in Korea is managed under the jeonsei system.
When using a jeonsei contract, the tenant is exempt from paying monthly rental fees for the length of the contract. Also, assuming there are no damages to the property being leased, the deposit from a jeonsei contract should be returned at the end of the lease period.
In the case of a “wolsei” contract, the tenant is not responsible for a large or, sometimes, any down payment but instead pays a monthly fee to the owner.
There is also another option to combine the two contracts so the tenant can pay a large sum upfront and make small monthly payments. However, tenants who sign for a shorter period of time will most likely be required to pay everything upfront.
If you wish to renew your contract (most likely a two-year-contract) at the end of your rental period, you must first get the consent of the landlord. The landlord may increase the cost of rent at the time of renewal, which is legal and acceptable.
Short-term leases vs. long-term leases
It’s generally difficult and costly to find short-term leases (3-6 months) in Korea, but definitely possible. Short-term leases are mostly ideal for those who are on temporary business trips or travelers.
However, most housing is available to rent for a period of 2 years. English instructors will probably already have a single year lease set up by their employer.
It is always best to use the services of a real estate agent when searching for housing and negotiating or drawing up contracts. They can help by finding the type of housing you want, provide you with a contract, translate and clarify documents, and represent you properly.
Deposits and guarantees
Generally, the higher the deposit, the lower the monthly rent for a length of your stay. Your deposit should be paid back at the end of your contract without interest. In order to get your money back, a real estate agent can research the owner to make sure he or she is reliable and not in debt. In some cases, the owner is not obligated to return your money so clarify the details of your deposit.
As you will be moving into a clean, orderly residence, you will be expected to leave it in the same condition as you found it, if not better! Any damages to your apartment or house will cost you some or all of your initial deposit. Therefore, if you encounter problems with any pre-existing furniture, fixtures, or any other part of the house, report it to your landlord so you do not get charged later on.
Rights and obligations of the tenant
As the lessee, you are obligated to remain in your residence for at least half of the duration of your lease. If you decide to terminate the contract early, you should give your landlord a warning at least one month in advance.
In any case, an early termination is grounds for extra charges or an unreturned deposit. A tenant could get back rental fees for the months that he or she will not be occupying the space, depending on your contract.
The landlord also has the right to check up on his or her property from time to time, particularly when nearing the end of your lease agreement, to assure the condition of the residence is acceptable. If the property owner discovers damages, your deposit will not be returned in full or at all.