I’m back from one of the most loathsome activities known to me: home hunting. I despise moving – the searching, the haggling, the indecisions and bad decisions, the packing and unpacking, the getting to know a new space and a new neighbourhood. It’s all horrible to me. And yet, in the past 11 years I’ve managed to move 8 times (not including moves back to my parent’s house!)
And this time, searching for a new place to call home is even more complicated. For over four years, I have been living by myself. I chose my past accommodations based on the neighbourhood I thought I wanted to be in and based on the features I wanted in the house. In one case, I did make a poor choice of apartment, but in my defence I had been in Korea all of 2 days with absolutely no foreknowledge of the state of housing here. And in any case, the ill-chosen apartment was MY decision.
Now, I suddenly have to make the first big compromise in our almost married life. Not only do we have to agree about where to live and find a place in between our places of work, I am also entering a new kind of housing market that I have never been involved in before.
Until now, I have been involved in the ‘wolse’ system, meaning I put down a small amount of ‘key money’ the landlord holds as a deposit (say $5,000) while also paying monthly rent (say $600). Under this system, after the year-long lease, I can opt to stay in my apartment until I give one month notice that I am leaving. It’s a system that most landlords in expat-heavy areas prefer because the leasees themselves are more comfortable with this system as it is closer to most Western systems, and it is a good way to make a decent amount of money every month.
However, the wolse system is used infrequently by middle class Koreans themselves. They prefer to use the chonse system wherein the leasee pays a large sum (say $100 000-$200 000) to the landlord who then invests the money to make a profit. The leasee does not pay monthly rent, but they do not collect interest on their savings either. At the end of the contract (usually 1-2 years), the landlord returns to the lump sum to the leasee. Of course there are those who buy the few homes or more common ‘luxury’ apartments in Seoul, but the middle class usually opts for the chonse system because they prefer to stay away from monthly rent and cannot not participate in the volatile and sky rocketing housing market.
(The ever opulant Lotte Castle Apartments)
Several of Mr. Lee’s newly married acquaintances have opted to try and buy an apartment instead of putting down chonse. However, as mortgages are sparse and we have fewer financing options because I am not ethnically Korean, (not to mention fears of housing bubble bursts – again), we had decided to go with chonse. I use past perfect here because we were quite sure about chonse until we learned of the housing reality in Seoul.
Until the economic crisis, landlords were able to earn a lot of interest from the chonse, but these days more and more landlords are realizing that wolse is more profitable because it is not subject to market volatility and interest rates.
The biggest problem facing the Korean renter today is that the rental market is in a period of transition. Landlords want monthly rent while renters loath paying every month because they are not used to the concept. Mr. Lee is having this particular problem. Until today, he was quite sure that our (in my opinion) decent sized chonse amount would be able to secure us a clean 2 bed room apartment in a building Koreans call ‘villas’ (‘apartment’ is a term reserved only for large apartment complexes). For various personal reasons (not to mention the fact that I don’t really like characterless apartment complexes), we decided on trying to find a villa.
So Mr. Lee’s friend, a lovely man with a heart of gold who lives in the area of the city we are interested in living, took us out home hunting today after scouting the neighbourhood in advance. It’s a pretty average middle class residential area north of the Han River (south of the Han, or ‘Gangnam,’ is considered the wealthy ‘upscale’ area of Seoul although that is not always the case). We decided to look in this area because it is just a few bus stops away from my workplace and half the distance Mr. Lee currently travels to his office.
We saw two apartments with the first realtor – only 2 because none of the other 20 landlords they called accept chonse anymore. The first place we saw was a tiny 2 room apartment with a ‘master’ bedroom just big enough for a double bed and a second room just large enough to hold a rack of clothes. It lacked natural light, had a dingy windowless bathroom, and was made even more claustrophobic by the huge floral print somebody lacking decorating talent had chosen to wallpaper the walls. (Imagine something like this is a small windowless room).
The second place, inhabited by a newly married couple themselves, was even tinier, dingier, and smelled like a wet dog. Oh, and I forgot to mention it was on the fourth floor, accessible only by a precariously narrow set of steep stairs.
We were then told by the realtor that if we wanted anything nicer through chonse, we should expect to fork over closer to $200,000!! All in all, the first realtor and set of places made Mr. Lee scratch his ear nervously and got him thinking a little bit about how we might have to change our plans.
After a long discussion with his friend, Mr. Lee agreed that we should at least look at the wolse possibilities or a combination wolse-chonse. With this option we finally found a place that gives us hope in our house hunt. It’s in a newish building on the fourth floor – but this time the complex has an elevator! Although the bathroom is small and basic Asian style (no separation between the shower and rest of the bathroom – meaning your floor and toilet are perpetually wet), it has three reasonably sized rooms, a medium sized ‘living space,’ and large windows which will provide a lot of natural light and air flow. I couldn’t take pictures of the actual bathroom, but this is similar to what we might be getting.
We’re not sure if we are going to take it – both Mr. Lee and his friend remain unconvinced that the wolse-chonse route is the best way to go – and we want to see other options with other realtors. We are planning on tramping around the neighbourhood again next weekend with a better understanding of the area and the options available. However, after seeing the first few hovels, it is nice to learn that there is something out there somewhat in our price range.