Jump to content

JamesKorea

Members
  • Content Count

    14
  • Joined

  • Last visited

    Never

Community Reputation

0 Neutral
  1. Yes, find a specialist for expats. You probably don't want to make your spouse a subject of the US, but in some cases it might make sense. Us expats likely have to file as married filing separately to avoid bringing our spouse into the corrupt US system. If you have children, you may be able to claim head of household which gives a slightly better tax situation, but keep receipts, as you need to prove you paid most the household expenses.
  2. If you have plans to visit Korea for a few days, weeks or months and you are looking out for a temporary accommodation in Korea then Goshiwon, Hasukjib or Yeogwan could be the right fit for you. Goshiwon is more for students whereas Hasukjib and Yeogwan is more suitable for working professionals who are looking for a budget stay in Korea and does not want to go through the hassle of house renting, lease, deposit, utilities and so on. Read the guide below to check which one is more suitable for you. Goshiwon – 고시원 Goshiwons are a remarkably cheap way of living in Korea. It is a very small and basic room where students often live in and study for a number of months in order to focus on a test (고시). Living in Goshiwon is similar to living in a dormitory. Wireless or DSL Internet connection, cable television, a bed, a small fridge and a desk is usually provided. Every floor has one to three bathrooms and shower rooms that are shared along with kitchen, showers and washing machine. Nearly every Goshiwon has a kitchen with basic appliances, free rice, kimchi and seaweed. If you are fortunate you might get some free noodles as well. Some also provide laundry soap, toilette paper, cooked rice, and bar soap. One of the biggest advantages of Goshiwon is that you don’t have to worry about utilities. The monthly rent it is all-inclusive and would range anything from 200,000 to 400,000 won per month. ($200 – $400 per month) The Goshiwon is supposed to be a quiet place and not a place for friends to gather. The walls are usually extremely thin and even light talking can find its way around the building. Some goshiwons only allow students, some allow working people too. The cheaper goshiwons have problems with cleanliness, petty thieves etc. The more expensive ones are usually safe. Hasuk Jib – 하숙집 Hasuk Jip is very similar to Goshiwon. The rooms are private and small but the kitchen and bathroom are shared. The main difference between Goshiwon and a Hasuk Jip is that with the Hasuk Jip you are provided with two meals a day – one for breakfast and one for dinner. Some places even do your laundry for you. They are like boarding houses with small rooms complete with single bed, desk, and TV. Some places have in-room private showers and some have shared facilities. Hasuk Jib is more suitable for working professionals and adults. You do not have to worry about utilities. Your monthly rent would run as low as 300,000 won a month and go up to 600,000 won or more, depending on location, room size, and services available. ($300 – $600 per month) Finding a goshiwon or hasuk jib is very easy, but it’s very hard to do it over the Internet. Most of the ajummas who run these places are particularly not computer literate. Even if you are able to find one over the Internet, there’s a good chance that you’ll pay way more than you need to. So it is advisable to come here and look for the signs that say 고시원. Yeogwan – 여관 Yeogwans are cheap hotels, which can be found everywhere throughout Korea. Usually, western-style beds are provided. Prices range from 20,000 won/night to 40,000 won/night. ($20 – $40 per night) Minbak – 민박 and Yeoinsuk – 여인숙 Minbaks are homestays or ‘bed and breakfast’ style set-ups, usually found in rural areas and islands. You can expect traditional Korean comforts such as blankets and an ondol-heated floor, in place of a bed. Prices range from as low as 10,000 won/night to upwards of 50,000 won/night or more if you are in an area with heavy tourism during a peak travel time. ($10 – $50 per night) Yeoinsuk are cheap inns, along the lines of minbaks or small yeogwans usually found in rural areas with blankets and ondol-heated floors, instead of beds. Prices range from as low as 10,000 won/night to 50,000 won/night or more, depending on location and season. ($10 – $50 per night) 찜질방 (Jjimjilbang) Jjimjilbangs are also a great deal for the cost-conscious traveller in Korea. They are large, gender-segregated public bathhouses complete with hot tubs, showers, saunas and massage tables. For 6,000-10,000 Won, ($6 – $10 per day usage) one can sleep overnight there and enjoy the bathhouse and sauna, and wake up fresh and ready to travel the next morning. If you have bags and backpacks with you that are too big to fit in the lockers, the front desk will usually watch over your bags at no charge for the length of your stay. Jjimjilbangs usually operate 24 hours and are a popular weekend getaway for Korean families to relax as the parents spend time soaking in tubs or lounging and sleeping while the kids play away on the PCs.
  3. Average Salary in Korea As per the labor statistics published by Ministry of Employment and Labor, the average annual salary per worker is around 2.878 million won per month (2012). With current exchange rate at 1060 won per dollar it comes to around $2700/month approximately. (Thanks Andy for providing this info). Ministry of Employment and Labor specializes in labor statistics alone, and they get the most recent and accurate wage data by surveying “Enterprises” not “each individual”. This data is then provided by the Government of Korea provides to International Labour Organization (ILO) for research about international wage comparison. For more details you can visit Ministry of Employment and Labor website. As per the article published in The Chosunilbo, the average wage of workers in Ulsan, where many giant enterprises are based, was 31.51 million KRW, the highest figure nationwide, whereas Incheon, the lowest, was merely 21 million KRW. A survey on Average Monthly Wage in various Korean Cities by the Ministry of Employment and Labor shows that workers in Seoul, Ulsan and South Jeolla Province are paid more than their counterparts in other regions. People who work in Seoul received an average of W2.921 million a month, followed by W2.822 million in Ulsan, and W2.557 million in South Jeolla Province. The high-paying industries such as finance, insurance and professional services are concentrated in Seoul, while Ulsan is home to large heavy industries such as automobiles and shipbuilding, as well as their sub-contractors. Many large-scale chemical manufacturers are based in South Jeolla Province. Meanwhile, employees in Jeju, Daegu and Gwangju earned less than 90 percent of the national average. The median income stood at W3.5 million a month for a household of two or more members. A total of 13,000 firms with at least five full-time employees as of April this year were included in the survey (2007 data). In the article The cost of Gangnam Sytle Education asiancorrespondent.com says that three out of ten households in Gangnam-gu earn an average of five million won ($4,730) per month or more as per the study conducted by the local government in 2011. It was found that 27.5% of Gangnam households earn an average of five million won per month or more. 19.3% earn three to four million won, 18% earn two to three million won, and 17.6% earn four to five million won. 10.7% earn one to two million won, and 6.9% earn less than one million won. Expats on an average are offered around 2.5 million KRW per month before deduction of taxes. Tax Deductions from your Korean Salary Pension (국민연금) 4.5% of your salary Health (or Medical) Insurance (건강보험) 2.665% of your salary Income Tax (소득세) Under 12 Million Won – 6% Under 46 Million Won – 15% Under 88 Million Won – 24% Over 88 Million Won – 33% Residence Tax (주민세) 10% of your Income Tax Sample Salary Structure in Korea Pre Tax Salary (Annual) 30,000,000 KRW National Pension 1,350.000 KRW Medical or Health Insurance 799,500 KRW Income Tax 1,081,970 KRW Resident Tax 108,197 KRW Annual Income After Deductions 26,660,333 KRW Monthly Take Home 2,221,695 KRW The Korean fiscal year runs from 1 January to 31 December When you finish a one-year contract, you receive an extra month’s regular salary as Severance Pay. Your air ticket fare for your arrival gets added to your first months salary and your air ticket fare for your departure is paid to you at the end of your contract or is added to your salary in equated monthly installments. Rent free housing is provided. Paying for Maintenance and Utilities is your responsibility. Additional allowance offered by some Korean companies could be meal allowance, automobile allowance, education expense (for learning Korean Language or for the education of your kids). This is just a general idea of what the deductions could be and how much you will get in hand at the end of the month. But for exact details about your salary and monthly take home you need to get in touch with your HR or Consultant for your Korean Company and ask them to provide a detailed break up of your salary along with a dummy paycheck with all the details listed about the expect monthly deductions.
  4. A Korean postal code is a series of 6 numbers separated by a hyphen in the middle. An example of a Postal Code in Korea is “139-660”. Although you don’t necessarily need a postal code in order to send mail to Korea, it’s often a good idea to make sure your items are delivered as quickly as possible. If you have the main parts of your address, you can look it up using the Korea Post website here. Once you enter the site, select the metropolitan, city, and dong (neighborhood) in order to generate a list of possible postal codes. Once the list appears, choose the correct address based off of the street number and your postal code will appear. If you are already living in Korea and get bills or other mail delivered to your house without a postal code, don’t be surprised. It is common in Korea to leave out unnecessary information, and that applies to Korean postal codes as well. When writing a post code on Korea-bound mail, make sure to write it on the last line of the address.
  5. Korean apartments have a unique system in place for the disposal of trash, recycling, and food waste. Especially coming from North America, it can be surprising to see how small some of the trash pails can be. It may be confusing at first, but once you get it down it’s actually quite convenient. For one, it makes you more conscious of what you’re throwing out and what can be recycled. Here is a breakdown of the different kinds of items you’ll need to learn to separate you dispose of your waste in Korea. Food Waste The food you don’t use needs to be separated into a separate container designated for food waste. One option is to get a separate food pail and empty it into the nearest food waste recycling container near your house. That container is not available in all neighborhoods, so you need to ask you landlord. The second option is to get food waste bags and leave them outside for pickup. The bag size and costs are: 3 liter – 240 won/bag 5 liter – 400 won/bag The bags have the local neighborhood waste pickup service printed on them, so make sure you buy them from a convenience store near your house! If you make the mistake of trying to buy bags on the way home from work in a different area, your bags of food will still be sitting outside of your house the morning after pickup. The trash collectors will only pick up waste if it is in the correct bag. Trash The trash pickup program is the big brother to the food waste system. You must purchase bags at your local convenience store and bring them out to the curb on trash day. The bags are clear, so it is possible to see if there are recyclable items inside. Make sure you are separating the items out and not just trashing them. There are cameras on the streets in many neighborhoods and you could get a fine for throwing out recyclable items. As for the bag sizes, you have choices: 10 liter – 190 won/bag 20 liter – 370 won/bag 50 liter – 990 won/bag 100 liter – 1,970 won/bag Recycling You need to separate out your cardboard, paper, plastic, glass, and aluminum from the rest of the trash. Some neighborhoods allow you to put these all in one bag or net and the recycling employees will separate it out themselves. Other neighborhoods require you to separate out the items by type of material and put them into different bags. This could be inconvenient since you need a supply of bags and they don’t give them away often at most stores. You could ask for extra when shopping or buy a few (about 20 won each) if the store charges for them. Another option is to order the bags off of a site like GMarket and always have a supply handy. If you live in an officetel or large apartment building, they often have separate bins in the basement where you can separate and discard your recyclable items. Pickup Pickup days vary by neighborhood and by the type of apartment you have. For officetels and large apartments, it doesn’t matter. Just bring your waste down to the basement and put it in the appropriate receptacles. If you’re in a house or villa, you need to ask your landlord. Some areas allow you to put out recycling and trash any day you want. Other places are more strict and only have trash pickup on certain days. For example, you may only be able to bring out the trash Tuesday, Thursday, and Saturday after 7pm. What is Recyclable? There seems to be more a “choose your own adventure” system when it comes to what the recycling workers will pick up. At some houses, they will take almost anything that resembles cardboard, plastic, or paper. In others, they will be really picky and only take the recycling if it meets their guidelines. This could be frustrating at first, so listen carefully to what the landlord says. It is possible that the landlord doesn’t know exactly, so in those cases you need to test it out. You’ll know if your recycling sorting skills need some practice or not when you open your front door and take your first step into a pile of aluminum cans. Donation Boxes If you need to get rid of old clothes, look for donation bins in your area. They are usually green metal containers, similar to Goodwill or Salvation Army containers you’d find in North America. The challenging part about finding these bins is that they are not in obvious places and there is no system for where they are placed. They are organized and placed by charity groups who try to raise money for the disabled and the less fortunate. Your best bet is to keep an eye out when you’re walking around and note when you do see one. The Salvation Army does have locations for accepting donations but it’s easier to find a local donation bin. Removal of Furniture and Appliances It’s finally time to say goodbye to the old sofa. The two of you have spent some serious time together, but you need to part ways. There’s a younger, more attractive sofa coming in soon, and there isn’t enough space in your apartment for both of them. Nobody on Craigslist wants to give your couch a new home, so what to do? If you need to dispose of old furniture or large items, you can’t just leave them in front of your house. You need to call the appropriate company that handles the disposal for your area. This will differ for each neighborhood. The local government agencies have agreements made with private companies who are assigned to dispose of large items for the area. You can call the Dasan hotline (120), which is a free service for life and tourism in Seoul, to locate those companies. There is a fee for the pickup of your unwanted items, so be ready to have a description of your soon-to-be ex-furniture. Now that you have the trash system in Korea all figured out, you can tackle that spring cleaning project you’ve been putting off with confidence!
  6. When searching for an apartment, you’ll notice that the housing rental system in Korea is quite different than in your home country. Different vocabulary and options are available for an apartment in Korea. Specifically, two words keep popping up: Jeonse and wolse. What do they mean, and which one is better? Jeonse is a term used to describe the agreement between a renter and a landlord where the renter pays a large deposit (보증금 or bojeongeum) to the landlord in order to live in the house rent-free. Contracts typically range from 2-3 years, and the full bojeongeum amount is returned to the lessee at the end of the contract period. An apartment in Korea using the jeonse system will usually be approximately 40 – 90% of the market value. For example, if the market price for a studio apartment 100,000,000 won, then the bojeongeum amount will be: (100,000,000 won) x (.40 – .90) = 40,000,000 – 90,000,000 won This amount will vary based on the area, the quality of the unit, and the furnishings included. Once you enter into a jeonse contract, the landlord is free to use your bojeongeum for other investments as long as it is returned to you in full at the end of the contract. This is generally a safe process as long as you do your due diligence. Make sure you check that there are no unpaid loans on the building before you authorize the agreement. Wolse is used to describe the rental system in Korea that is more similar to the West. It is like jeonse, except that the bojeongeum amount is significantly smaller and a monthly rent is also paid to the landlord. The contract period is generally 1-2 years and the full bojeongeum is returned at the end of the contract. An apartment in Korea using the wolse system will usually be about 1% of the jeonse amount. For example, if a studio requires an 80,000,000 jeonse deposit, the wolse monthly rent will be: (80,000,000 won) x (.01) = 800,000 won per month (no bojeongeum) Landlords typically want some kind of bojeongeum, even with the wolse system. This amount is often between 5,000,000 – 20,000,000 won, depending on a number of factors. 5,000,000 won in bojeongeum is equal to 50,000 won per month in rent. So given the above scenario, the same studio at 800,000 won per month can also be had with a 10,000,000 won bojeongeum deposit: 800,000 won per month = (700,000 won per month) + (10,000,000 won bojeongeum) The deposit amount can often be negotiated, but that is at the discretion of the landlord. Recently landlords have been favoring monthly rents instead of a higher bojeongeum, but this will vary. So which one is better? There is no clear answer, especially with the recent changes in the Korean housing market. Interest rates are a record lows, and there is a lack of confidence that housing values will continue to rise. People’s preferences with respect to the rental system in Korea are clearly changing. Fewer jeonse units are available since landlords would prefer to receive a steady monthly rent instead of the lower amount earned from interest rates. An unsteady housing market in Korea is encouraging people and families to stick with jeonse instead of being locked into a mortgage on an apartment that may decrease in value. Many expats in Korea don’t arrive here with a large pile of cash ready to hand over to a building owner, so for those people wolse is a good option. Also wolse contracts tend to be for shorter periods of time, which allows for greater flexibility if you aren’t sure where you’ll be in the next 2-3 years. If you are uncertain about which way to go regarding the rental system in Korea, you need to gather more information. Do your research and make sure you fully understand the pros and cons of each option. One action that can help you make this decision is to get out there and see some apartments for yourself. This step alone may make the decision clear since you’ll see what you can get for your money. There are real estate offices (부동산 or budongsan) in every neighborhood in Korea, so pop in and pay them a visit. If you don’t speak Korean or need some useful vocabulary, you can download our free quick start guide here to get you moving as quickly as possible. Map out a few areas that you would like to consider living in, prepare a rough overview of the kind of apartment in Korea you are looking for, and pay the budongsan a visit. You don’t always need an appointment and they’re usually quite friendly. Even if you don’t speak Korean, it’s good to head in there with at least a few key Korean vocabulary words. If you make the effort to learn a few Korean words and phrases, they will usually reciprocate in English even if they’re not confident speakers. Best of luck!
  7. If you’re coming to Korea for a vacation or a short trip, you will notice that Airbnb in Seoul is often a better choice than smaller and pricier hotel rooms. Getting a room off of Airbnb in Seoul is an excellent option if you’re staying only a few days. However, if you plan to come to visit for weeks or months at a time you’re better off getting a short term apartment rental. You’ll end up paying much less and possibly get a better apartment than you would off of Airbnb in Seoul. The Korean housing system can seem like a mystery compared to your home country, so most people don’t attempt to look into these short term places on their own. However, if you are interested in having more control and saving some cash, then you should look into short-term Seoul apartments. Let’s look at an example to illustrate the difference between getting a place off of Airbnb in Seoul and a short-term apartment. We will look at a studio room off of Airbnb in the Gangnam area and compare it to a fully furnished monthly rental short-term apartment using monthly rates (30 day month). These two places both have a kitchen and bathroom, are similar in quality, and are a 5 minute walk from each other. As you can see in the comparisons, the monthly rental prices are significantly different. This is especially true if there are 2 guests, where the monthly costs for the Airbnb option are more than double. Airbnb in Seoul is a great option for short-term stays, but for anything longer than 3 weeks it’s worth checking out short-term apartments. This will not only save you money, but also possibly get you a better quality place to stay. To find these short-term apartments, the first step is to contact a real estate office in the area of Seoul that you want to stay and ask the agents if they have short-term rentals.
  8. Half of Korea’s population lives within the metropolitan area of Seoul. Due to the limited geographical space in Korea, it is very rare to find stand-alone houses and most people live in apartments in Korea. The size of an apartment in Korea is measured in units called pyeong. One pyeong equals approximately 3.3 square meters or 35 square feet. A 10 pyeong apartment is about 33 m2 or 356 ft2. Apartments in Korea are separated into a few categories of building types: aparts (아파트), officetels (오피스텔), and villas (빌라). There are a few other smaller categories, but we’ll stick with the main three. Villas are three to five story buildings that vary in size and layout. The units inside can significantly differ from building to building, and the buildings are typically older. In terms of Korean apartment size and price, villa apartments tend to be a good overall value and tenants can get a larger place for the same cost as a similar officetel apartment. A studio apartment will usually be from 5 – 15 pyeong (16.5m2 – 49.5m2 or 178ft2 – 534ft2). A one bedroom unit ranges from 10 – 18 pyeong (33m2 – 59.6m2 or 356ft2 – 640.5ft2). Two bedroom villa apartments will vary from 16 pyeong – 25 pyeong (53m2 – 83m2 or 569ft2 – 890ft2). Three bedroom places are generally 27 pyeong or more (89m2 or 960ft2). Officel apartments are similar to villas but are generally newer high-rise buildings with a few room layouts duplicated on each floor. Usually these will be studio or one bedroom units. Apartments in these buildings will usually be about 10-20% more expensive than a similar size villa apartment. The sizes will be comparable to villa units for studios (5 – 15 pyeong = 16.5m2 – 49.5m2 or 178ft2 – 534ft2) or one bedroom apartments (10 – 18 pyeong = 33m2 – 59.6m2 or 356ft2 – 640.5ft2). Apartments in “apart” buildings are larger units that consist of 2-4 bedrooms with 1-2 bathrooms. These units are designed for families and are often in newer high-rise buildings. These apartments are 50 pyeong and up (165m2+, 1,779ft2+). The layout of the apartment is very important in Korea since some apartments have much more useable space than others. Seeing the apartment in person is best. If that’s not an option, make sure to get a video with lots of detailed pictures of both the inside and outside of the building before you make your decision about where to live in Korea.
  9. Obstacles such as language barriers, large security deposits, and confusing contracts leave many expats and international visitors to Korea feeling overwhelmed before they even get started searching for housing. Though many expats have little say in where they live during their first year in Korea, expats eventually want to venture out on their own and find a place that matches their lifestyle and preferences. Below are 12 dos and don’ts for those searching for housing in Korea: DO prioritize and consider alternative locations. Going a few stops on the same subway line from your search location can open up a completely new set of options at a much better value. Know your priorities in terms of location, price, size, and cleanliness and be ready to pounce on any deals. DO check the financial status of the residence. Before entering into a contract, it’s a good idea to ensure that the building owner is in good financial standing. Ask the real estate agent to print the court registry1. DO ask about the monthly building maintenance fee2 for each apartment. The monthly building fee covers things such as common area lighting and cleaning, elevator usage, Internet, and the water fee. As a negotiation tactic, try to get it included in the rent! DO maximize your contract terms by matching your rent and deposit preferences. Rent and deposit amounts can be negotiated: A W5 million security deposit is equal to W50,000 in rent each month. Many landlords will negotiate the rent by accepting a larger deposit amount. If you put down an extra W5 million, your rent can typically be decreased by W50,000 every month. DO update your ARC card and get a fixed-date stamp on your housing contract. After you move, you have 14 days to update your ARC(Alien Registration) card with the new address. Do this at the immigration office or the local government office3. You also need to get a “fixed-date” stamp on your housing contract at the government office. The stamp indicates that your housing contract has been entered into the government system, which helps to protect your housing deposit. DO NOT expect all real estate agents to speak English. The majority of real estate agents will not speak English. We have created a list of real estate-specific Korean vocabulary and expressions, and 10 Magazine readers can download it at: yourultimateapartment.com/korea. These will help you to a point, but once you are ready to negotiate and sign the contract, it will be helpful to have a Korean or other knowledgeable party present to assist you. DO NOT visit a real estate office unless you are two to four weeks out from moving into a new place. The pace of life is fast in Korea, and the same is true for the housing market. Many real estate agents will request that you come back about 2-4 weeks prior to your move date. DO NOT be surprised if some apartment owners won’t rent to you. Some apartment owners have preferences for who they’ll accept as tenants. They may only rent to females or may not want to rent to non-Koreans. Don’t take it personally. DO NOT assume that one real estate agent has all the listings for a given area. Although most real estate agents have access to the same database for housing, these databases aren’t always up to date. Often certain agents will have relationships with landlords and will know when hot deals become available before others will. Using only one real estate agent to cover large areas of a city will limit your choices. DO NOT rely solely on Craigslist. In Korea, the housing rental market isn’t well-organized online. Contracts happen faster than agents can snap pictures and upload them to a site. If a house is on the internet or a site like Craigslist for a while and nobody has rented it, then there’s usually a good reason why. Many listings on Craigslist are actually real estate agents. If a listing says there is no commission for the contract or the real estate agent, then you should be suspicious as to whether or not it’s a legally binding contract. With the often times large amounts of money involved in the transactions, it’s by far better to pay the fee of a professional agent. If you are looking at sublet listings, know that many contracts have clauses that do not allow for subletting. If you’ve been thinking about looking for a place in Korea and you’ve been hesitating about moving forward, hopefully this information will give you a boost in the right direction. Good luck and we’ll see you at the housewarming! 1 Court registry – 등기사항전부증명서 (deung-gi-sa-hang-jeon-bu-jeung-myeong-seo) 2 Monthly building maintenance fee – 관리비 (gwalli-bi) 3 Local government office – 구청 (gu-cheong) or 주민센터 (jumin-center) *A real estate agent will tell you which office you need to go to.
  10. If you have flexibility with your move dates, then it is worthwhile to plan your move in Korea with some specifics in mind. This will allow you to understand market availability and demand so you can use these factors to your advantage. Holidays Korea has public holidays throughout the year, a list of which can be found here. Take these holidays into account when moving since you may have limited access to banking on that day. You’ll need to coordinate with your landlord since the bulk of your housing deposit is usually due on move-in day. In addition, moving companies will charge a premium on these days (if they’re even available to help you at all), so plan your move to your next Korean apartment accordingly. First Day of the Semester Universities in Korea generally begin the first week of March and September, so large numbers of students are moving the weekend before. This means that every part-time, full-time, and contract mover with a pickup truck in the area will be scheduled to help students get set up in their new Korean apartment. With that, you’ll also notice that moving costs will be significantly higher. Traffic will be more congested, slowing down your move. Plan around these dates to cut down your costs and move time. Winter and Summer Most people prefer to move in spring and fall since the weather is milder and the move is easier. With that, the number of available houses will increase during those time periods. However, you will also have slightly less bargaining power since landlords will have more potential tenants. Summer is also a popular time to move, but it’s slightly less appealing since the scorching summer days can add to the stress of moving. Winter will generally have the lowest number of vacancies. People prefer not to move in the winter because of the cold temperatures that most of Korea experiences. In addition, moving can be difficult since snowfall can slow your move down or even bring it to a halt. Given the challenges associated with moving in the winter, landlords know that it’s tougher to fill vacancies from December to February. This will give you slightly more bargaining power with your next Korean apartment. What to Move? If you’re going from one unfurnished place to another, it can be a tough decision what to bring with you. Maybe you have a refrigerator and washing machine that you purchased but you aren’t sure if it’s worthwhile to take them. It’s best to call the moving companies for an estimate before you make the decision. If your new house is far away and you don’t have a close personal attachment to your appliances, consider selling them on Craigslist or a nearby second hand recycling store and purchasing a used one in the new area you’re moving to. Sometimes the total cost of moving your current appliances is more expensive than simply lightening your load and replacing them. Now that you know the pros and cons of moving during the various times during the year, you can settle your move dates with confidence. Good luck and happy viewing!
  11. Imagine that you go searching for housing in Korea. You look on Craigslist, and you see a posting from a real estate agent who says he could save you 50% off of a house listing. What would you think? Is this an apartment that normally rented for 1,000,000 won per month, and he would get it for you for 500,000 won? Or is this a place that normally rents for 500,000 won per month, but he marked up the listing to 1,000,000 won? It’s hard to know, but these situations come up in real estate listings all the time. Raise your hand if you’ve ever seen: “Up to 70% off of the listing price!” “No contract or real estate fees!” “Save money and cut out the brokers!” If you see these statements or claims, you should definitely be weary. Potential red flags! It’s not that good deals don’t exist (they definitely do!). It’s that a lot of the ads and postings you see are hype, designed to make you think you’re getting a great deal. The smoking hot deals are out there, if you know what to look for. Below are 7 common mistakes that people make when searching for housing in Korea. Most of them apply to people who are searching using real estate agents. Generally, using agents is the best and safest way to find Korean housing. There are exceptions, such as “my aunt is the building owner” or “my best friend is subletting her place to me for a few months.” When entering into a Korean housing rental agreement, there is a lot of money is at stake, so follow Mom’s advice of “better to be safe than sorry!” Assuming All Landlords Will Take You This is definitely not the case in Korea! Your real estate agent should do the screening for landlords before you view apartments, but sometimes there are misunderstandings. It may happen where you visit a house, and the landlord won’t want to show you the place. It could be because of your gender (some places are female only), your nationality, language ability, or anything else the landlord decides. Even if the landlord does let you see the apartment, you’re not out of the woods yet! He may still decide to not rent for you for any number of reasons! Make yourself the best possible tenant candidate by doing things like getting a bank account in Korea, having a clear explanation of your job or where your income comes from, and knowing some basic Korean. Standard Agent Commissions You know those friendly English-speaking real estate agents that seem happy to help expats coming to Korea? The reason they are focused on expats is because they know they can get away with charging a premium! They view their English-speaking ability as an added benefit, so they think they should be able to charge more. Also, most expats don’t know that there is a housing contract set commission. This is the amount you should be paying for the housing contract, and no more! Koreans never pay above this amount. However, expats can be taken advantage of, so it’s best to make sure you know the commission structure before going hunting for housing in Korea. The commission chart can be found in the Your Ultimate Apartment free guide. Deposit Without a Contract This is a bad idea. If you’re going to hand over your hard earned cash, make sure it’s legally protected by the law. There are postings on the internet all the time about “no contract” , “no deposit”, and “no brokerage fee” required. Be very weary of this. If they’re offering you these terms, likely they’re overcharging you in other areas. There is no magic to the housing rental business. Understanding value and having the best information is the winning combination. Not Researching Neighborhoods This is especially important if you want to find great housing in Korea! Many people look in the popular areas, which are usually the more expensive spots to find apartments. It pays to take a look at what kind of lifestyle you want in Korea, and then find housing that supports that. This doesn’t mean you have to give up your dream location, either. It’s amazing to see the differences in housing when you go a few streets in other directions. You may find yourself closer to a park, subway station, or a supermarket. If you could find a better deal on an apartment AND it’s in a better location for you, then it’s a double win. Using the First Real Estate Agent Often times the first places that a real estate agent shows you are the worst choices. They are the places that have been on the market the longest because people don’t want them. Also, the agent is likely showing you places that the landlord has agreed to list with that particular agent. That means that if you sign the contract, the real estate agent gets paid from both you and the landlord. If you are shopping different real estate agents, you’re going to have much better options. Different agents have relationships with various landlords, so you’re going to see places that may not appear in the databases yet. Also the agents will be forced to step up their game and show you places that meet your requirements, even if they aren’t listed by that agent. Your agent will get commission from only one side (you), but he’ll be happy to make the sale! Using Only English-Speaking Agents Compared to the total number of real estate agents out there, the English-speaking agents are a very small percentage. By only working with the ones who speak English, you’re limiting the number of places you can see. Even if you don’t speak Korean, you can use the worksheets in the free Your Ultimate Apartment guide to help bridge the language gap. Assuming Your Deposit Is Safe This is definitely not the case. In Korea, most places require a very large housing deposit. On the lower end, we’re talking 5,000,000 – 10,000,000 won. Just because you enter into a contract, it doesn’t mean your deposit money is safe. Your real estate agent should do a due diligence check to make sure the financial profile of the property is in good shape. This is why it’s critical that you have a competent and professional agent. There you have it! These are the 7 potential pitfalls that trip people up. As long as you avoid these, you have a good chance to find a fantastic deal. The best way to protect yourself is by being knowledgable about the whole Korean housing system. Take your time, learn the rules, and ask lots of questions. The agents will often try to pressure you in order to get a sale. Politely but firmly stand your ground and don’t make a move until you are ready. If you need further help, we have a paid full Your Ultimate Apartment guide that covers everything in detail about the housing process and system in Korea. You could also ask us about a consultation if you want someone in your corner to ensure a smooth and worry-free housing search. Give us a shout and let us know how we can help! Happy Korean house hunting!
  12. A handsome young English teacher, and his girlfriend had been burned in a house fire swept the expat community here in Seoul. A lot of people—including my family—opened up their purses to donate funds for his staggering medical expenses, as Bill Kapoun was not enrolled in Korea’s National Medical Insurance Program. The Korea Times and Korea Herald both covered this story of profound interest to the English-teaching community, whose members are often not insured themselves. Sadly, the teacher died after a week in intensive care and an array of skin-graft operations intended to keep him alive and stable enough to be transferred by medevac to a burn unit in Chicago. Why is this relevant to you? There are a lot of differences in how Korean society treats foreigners in comparison to nationals, but access to the National Medical Insurance Program operated by the government is not one of them. If you’re not insured, you don’t have to stay that way. All lawful foreign residents are permitted—indeed, obligated—to subscribe (except for some well-remunerated foreign investors who can opt out if they have a global insurance plan). This means all English teachers on E-2 visas, students at Korean universities, industrial trainees, and so forth. I have heard, but don’t know for certain, that even illegal residents are also permitted to subscribe. In respect of full-time employees, the law requires employers to pay half the premiums for National Medical Insurance Program subscriptions; employees bear the other half. Full-time employees are anyone who works 15 hours or more per month. Their employers pay half, they pay half. Part-timers are not excluded from the scope of coverage—part-timers just have bear all the premiums themselves if their employer doesn’t voluntarily pay up. Just because your employer wants to dodge the expense of bearing the employer portion (half) of the National Medical Insurance Program premiums (usually something trivial like thirty bucks a month—half of sixty), you can still subscribe for insurance at your local district office (gu, shi, or gun). The National Health Insurance Corporation (NHIC) has an English-language website, and an English-language helpline at (02) 390-2000. There is also a comprehensive English-language brochure available at the NHIC website which explains most aspects of the program. Because this is Korea, the brochure is well-hidden on the NHIC website and its prose is not always as clear as one would like—but it’s a substantial effort to communicate with foreign residents of Korea.
  13. Let’s say you’ve decided to move to Seoul for a period of a few weeks or a few months. Perhaps you are here for business, an extended vacation, or to study language. Where do you find accommodations? You could leave it up to the people at your company or language school to get you set up, but that leaves a lot up to chance. With all the horror stories going around, why not take control and design your own lifestyle abroad? But where to start? Here is a comparison of the options for short-term accommodations in Seoul. Hotels This will usually be the most expensive type of short-term accommodation in Seoul, but also require the least amount of hassle. The benefits are that you will have a concierge desk for local information, room cleaned each day, no deposit, and you won’t have to stay for any specific amount of time. The downsides are that they likely don’t offer monthly rates, Wi-Fi may be an extra charge, the rooms often don’t include kitchens, and the space will be small. Serviced Apartments These are furnished apartments with services similar to those you would find at a hotel. The rooms are usually double or triple the size of a standard hotel and offer amenities such as a full kitchen, refrigerator, microwave, swimming pool, and a fitness center. They are often near public transportation, can be reserved online, and are more affordable for longer-term guests. While more affordable than hotels, they can still be rather pricey and still have a hotel feel. For a list of serviced apartments in Seoul, click here. Airbnb For those that are not familiar with the service, Airbnb allows people to rent out their homes to guests on a nightly, weekly, and monthly basis similar to a hotel or bed and breakfast. The Airbnb option for a short-term apartment in Seoul will generally be more cost-effective than hotels and serviced apartments. The pros are that you will have a proper apartment (kitchen, wash machine, etc.), the living space will be larger than a hotel, you can reserve from the internet, and you can view detailed pictures and reviews before you get there. The cons are that quality will vary, it may be in an inconvenient location, deposits are often required, and you have to commit to a specific period of time. Short-term Apartments The least expensive option for a short-term accommodation is to get an apartment just as a Korean would. Not only is it the least expensive, but it offers you the greatest flexibility and the most home-like feel. You’ll be able to choose the neighborhood you want to live in, have a range of options of apartment types, get the best value for your money, and have more of a local experience. The downsides to a short-term apartment in Seoul are that you will have to be responsible for paying for your monthly utility bills, you will need a 1 month security deposit, quality will vary, and you’ll usually need to be in Korea to arrange this. A short-term apartment in Seoul can be found by visiting the local real estate office and asking the agent what monthly rentals are available. If you’re not confident in your Korean abilities, you can download our free quick-start guide here which contains tools for contacting real estate agents as well as useful vocabulary and phrases for non-Korean speakers. We also offer a consulting service to help you get set up.
  14. So, you’ve got the job of setting up a Korean office. Congratulations! This post explains the required materials and process of establishing a Korean corporation, and answers frequently-asked questions, from the perspective of the foreign investor in Korea. First, put to bed the question of whether your office should take the form of a corporation organized under Korean law (i.e., a wholly-owned subsidiary, joint venture company, or a foreign-invested company) or the form of a registered branch office of a foreign corporation. There are reasons in favor and against both forms of organization, but this is intended to be an overview of what you need to do once you’re committed to establishing a company (we’ll call it the “Company”) as a chusik hoesa joint-stock company under the Commercial Code. Once you’ve finally determined to incorporate in Korea, you’ll need to be ready to mobilize the following: Minimum investment capital of at least W50 million At least one natural person to serve as statutory director of the Company At least one director of the Company to accept appointment as Representative Director (in a sole-director company, this will be the same person as the appointed director) At least one natural person to serve as statutory auditor of the Company Physical location of the Company’s registered address With these minimum resources, you can establish the Company. Sounds pretty easy, right? INVESTMENT CAPITAL Why is “at least” W50 million required? There are two reasons for this: First, the Commercial Code sets the minimum capitalization of a chusik hoesajoint-stock company at not less than W50 million. So that’s the least amount of money anyone in Korea needs to form a company—whether a Korean or a foreign investor, this rule applies to everyone. But additionally, foreign investors are regulated by the Foreign Investment Promotion Act. This law defines “foreign investment” as the contribution of cash or assets (but for the sake of simplicity, let’s stick to considering cash at this point) denominated in foreign currency and valued at not less than W50 million. The result is that any single foreign investor’s minimum capital contribution to a Korean company is that amount. What about joint ventures, or companies with more than one investor contributing capital? If any of them are foreign investors, regardless of the share ratio each foreign investor would have to contribute at least W50 million. If it is intended, for example, that two foreign investors make a 50-50 joint venture, in that case the minimum investment amount would be W100 million—W50 million apiece. After the capital is registered, what can we do with it? After capital is registered and relevant capital-registration taxes have been paid, investment funds may be deposited in the Company’s account and the Company is free to spend the registered capital on anything. Typical initial expenses include purchase of capital equipment (tables, chairs, computers, phones, etc.), office lease deposit and initial rent, employee wages and benefits, or even attorneys’ fees for the incorporation services. DIRECTORS AND AUDITOR How many directors and auditors is a company required to have? A Korean chusik hoesa joint-stock corporation is required to have at least one natural person to serve the Company as its statutory auditor. Larger companies may choose to establish an audit committee comprised of directors instead of appointing a statutory auditor. There is no limit on the number of statutory auditors. A corporation with registered capital of less than W500 million may appoint a sole director. This director would necessarily be appointed as the Representative Director as well. A corporation with registered capital of W500 million or greater must appoint at least three (3) directors. By far, the most common number of directors in Korean corporations is three. Are directors and auditors required to be Korean citizens, or foreigners resident in Korea? No. In most cases there is no requirement for directors (including the Representative Director) or auditor of the Company to be citizen of Korea. Residency is not required either. The entire Board of Directors may be comprised of Germans all living in Frankfurt, if that’s what the shareholder wants. As a practical matter, at least the Representative Director ought to be residentin Korea, because government offices and trading partners frequently expect to be able to easily contact the Representative Director in respect of matters pertaining to the Company. What do you mean by “Representative Director”? What’s that? Korea’s Commercial Code provides that one of the directors of the Company must be designated its “Representative Director”. This individual (who we’ll abbreviate “R/D”) is the chairman of the Board of Directors, and the Company’s chief executive officer; the R/D has full authority to represent and bind the company in all matters. It goes without saying that because the R/D is so powerful, only someone who is trusted completely should be appointed as R/D. Although it’s possible to restrict the powers of the R/D by inserting special provisions in the Articles of Incorporation of the Company, as a practical matter these restrictions basically only apply as between the R/D and the Company and/or its shareholder(s). We don’t have directors identified yet. Can a law firm provide its employees as “nominee directors”? From time to time, one of our members might agree to serve as director of a client company. But to be frank, accepting appointment as director entails significant responsibilities under the Commercial Code, and it would require an equally significant amount of mutual trust between the “nominee director” and the client for the arrangement to work. REGISTERED ADDRESS Korean law requires every company to report to the district court’s Commercial Registry certain public information. Among this information is the address of the company. If you’re going to establish a company, you have to know the address, although there’s no need to prove entitlement to use that address. But in order to obtain a taxpayer ID after incorporation, it’s necessary to show the tax office a copy of the Company’s lease agreement. So we recommend an investor get an office lined up before starting the incorporation process. Can we use a “serviced office”? There are a number of serviced-office providers in Korea. Among them are The Executive Centre, Regus, and a number of others. These providers will lease physical offices and provide support facilities and reception staff. Some of them also offer so-called “virtual office” packages with mail-collection and voice-mail service, but no physical office space; these packages are attractive, especially in the initial stage of investment, because they cost less. We recommend against trying to register a company with a “virtual office”.Although there is no express requirement for physical office space, the National Tax Service is suspicious of the so-called “paper company” with no real operations, and they are aware of the addresses of serviced-office providers. Increasingly, when helping clients register in serviced-office suites, we encounter a demand from the tax office to “inspect” the office to verify whether there is in fact a “real business” there. We haven’t picked out an office yet. Can we register in our Representative Director’s home address? In short, probably not. The reasons are interesting. There is no express ban on home-based business, and many domestic companies have gotten started in apartments, or “office-tel” mixed-use properties. But the tax office is supposed to verify the landlord’s taxpayer ID at the time of the Company presenting its lease agreement, in order to make sure that Value-Added Tax is being properly collected and paid on commercial rent. Residential landlords generally don’t want to go to the bother of getting a taxpayer ID just for your convenience. Some tax offices will overlook verification of the landlord’s taxpayer ID; in those districts, it’s easy to register a business in a residence. But other districts will insist on compliance with their regulations. The unpredictability of whether you will get stuck with a difficult tax office leads us to recommend against trying to register in a residential address. Can’t a law firm just give us a “brass plate” in their lobby? Why can’t we use your address? For the same reasons serviced-office “virtual office” packages are problematic, it’s not a good idea to try to register using a law firm’s address. OTHER MATTERS How long does it take to register a company? Timing is dependent on a number of factors. First, there is the time necessary for the investor to gather all the necessary documents. Because signatures must be notarized, and some documents need to be “consularized” at the nearest Korean Embassy or Consulate, it’s difficult to predict how long it will take in total because we don’t control all those factors. Wire transfers take between two and five days to clear through the banking system. A delay is sometimes introduced by the wire transfer when the investor tries to send exactly W50 million as the investment capital, but doesn’t take into account transfer fees and the possibility of exchange-rate variation. If less than W50 million is received for credit here in Korea, the bank will not be able to issue the foreign-currency certificate necessary to register the investment, and there will also not be enough capital to subscribe for the initial allotment of shares. But assuming no troubles, once papers are received back in Korea the Company may be established within three to five working days of receipt if the Company is located in Seoul or the surrounding area. Getting out to provincial areas may take longer. After the Company is registered, then we apply for the taxpayer ID number. That, too, would take at least three working days, but usually takes a week or two. Recently we’ve been running into some difficulties with both the companies register and the tax office, in respect of investors coming from so-called “unusual” jurisdictions—most recently, Cyprus—which the bureaucrats have less familiarity. In those cases, sometimes the taxpayer ID number can be delayed for weeks while the tax office satisfies itself with respect to the bona fide “real company” status of the applicant. Our time estimates are probably still good for American companies, but for non-American companies I would guess the entire process could take 20 working days or more once your documents are delivered to Korea. What official costs are there in establishing the company? Official taxes and government fees, and the cost of notarizations required by law, will total about W1,500,000 for a new corporation starting with W50,000,000 in share capital. The primary official cost is the capital registration tax—a tax assessed on the share capital of the company at the time of initial incorporation and each successive capital increase. The basic rate is 0.4%; the tax is trebled (to 1.2%) for companies registered in the Seoul Metropolitan Area. An education surtax of 20% is applied to the capital registration tax. Corporations are required to purchase a transportation bond to finance public infrastructure. The required bond purchase is 0.1% of newly-registered registered capital. The bond may be re-sold on a secondary market at a discount to its face value, or held for a period of some years and then redeemed at face value. In the case of a corporation registering W50,000,000 in share capital, the following official costs will be incurred: (i) capital registration tax, W600,000; (ii) education surtax, W120,000 (20% of W600,000); (iii) transportation bond, W500,000. Additionally, notarization of certain documents is required by law—the Articles of Incorporation, the Minutes of the Meeting of the Shareholders, the Minutes of the Meeting of the Board of Directors, and the Report of Seal filed with the court in respect of the company seal. These costs are variable out-of-pocket expenses, but typically range between W200,000-300,000. (The cost of notarizing Articles of Incorporation, for example, starts around W100,000 and increases based on the value of share capital.)
×
×
  • Create New...