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Kim Min-sun Intern Reporter
Large deposits posing ‘main problem’ for tenants, along with monthly rent hikes of 20 to 30 percent
August 12, 2008 | ||||
The JoongAng Daily will run a series of articles written by intern reporters in the coming days. The interns, high school and college students, researched their topics as professional reporters. Intern articles are proofread by the JoongAng Daily’s editors. Koreans think rent prices in the capital have gone up too fast in a relatively short period. In the past two to three years, rent prices, especially of small and midsize apartments, increased 20 to 30 percent in Seoul. Apartments near expatriate-frequented Itaewon, central Seoul, are no exception to the ongoing rent hikes. So how are expat tenants reacting to these changes? Kingxley Azuke from Nigeria, who lives in Haebangchon, says, “It’s true that now I’m paying more for my rent than when I came here a year ago. But the key money is the real trouble. I think the Korean government should make some amendments.” Rebecca Cant from England, who is now looking for a new home in Haebangchon, echoed Azuke’s sentiments. “Increasing rent prices are a problem to me. It has gone up too fast recently. However, the main problem is the large deposit.” Cant, who has lived in Korea for three years and publishes public school books, says her higher rent has been cutting into her savings. “I think it is unfair that the rent prices have increased about 20 to 30 percent. But my salary has only gone up about 6 percent. So it is not fair. Salary stays the same, but everything is more expensive.” Why are deposits so high? “In other countries, landlords charge two month’s rent for a deposit, but a different system is applied here in Korea,” said Jeong Hye-young, owner of Sejong Real Estate Agency, located in Gayang-dong, western Seoul. “Here, Koreans may have to pay 10 million won [$9,690] or more for a deposit. Landlords charge a high deposit just in case monthly rent is not paid in time. But the higher the deposit, the lower the monthly rent. “So if an expensive deposit is too much, you have to find a place with a lower deposit. Instead, you have to pay a relatively high monthly rent. That’s how the rent system goes here,” she added. Most expatriates who live in Korea look for homes in Itaewon or in Yongsan 2-ga-dong, which is also known as Haebangchon. Bruno Oum, who runs Central Realty Agency in Itaewon, explains that foreigner nationals who come to teach English usually look for two-bedroom apartments in Itaewon or Haebangchon for key money of 5 million won to 6 million won. Visitors from Africa or Southeast Asia generally look for homes in the 2 million won to 3 million won deposit price range with a monthly rent of 300,000 won. They mainly take one-room apartments that are 10 pyeong, or 33.3 square meters. Oum also listed a few reasons why expatriates prefer this area. “Even if they have all sorts of different occupations here in Korea, they tend to live here because this place is the center of Seoul, which makes it convenient for them to go anywhere. Also, many of their friends reside here. They form a community, which may help them adapt to Korea faster. Some also prefer this area because it is surrounded by Mount Namsan.” Despite expatriates’ preference of this location over other regions in Seoul, Oum says that the number of foreign renters visiting his agency has decreased a bit recently. He mainly blames higher rent prices. “Because monthly rates near Itaewon have risen about 20 to 30 percent, it is true that it might have affected expatriates.” Park Song-hong, who runs Starland Properties, Inc. in Haebangchon, says, “If you look at other regions in Korea, such as Bundang or Yongin, rent prices have plummeted. But in Seoul, especially near Itaewon, the prices have soared. There exists a continuous demand for apartment rentals here due to foreigners looking for homes. “Also, this area provides them with access to convenient transportation. These reasons may have resulted in the increase in rent.” The declining number of prospective foreign renters, according to Oum, has been compounded by several other factors. “Since last year the screening for E-2 visas, which are given to expatriates who come to teach English in Korea, has become stricter. So the number of foreigners who came to teach decreased. “In addition, the demand of U.S. Army soldiers waned due to their movement to Osan,” Oum said. The Korean and U.S. governments decided to move the U.S. Army base from Yongsan to Osan, Gyeonggi, by 2012 in their 2004 negotiations. American soldiers also live in Yongsan District because they have government-granted housing visas that determine where they should live. Their rent differs according to their military grade, from 2 million won to 5 million won. This article was written with the assistance of JoongAng Daily staff reporter Sung So-young. By Kim Min-sun Intern Reporter [kms2532@hanmail.net] |
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