Jeonse vs Monthly Rent: Which is Better?
2025-09-29
1. What is Jeonse?
Jeonse is Korea's unique housing system where you deposit a large sum (jeonse deposit) with the landlord and live rent-free for a fixed period. The full deposit is returned at the end of the contract. Typically contracts are for 2 years, and jeonse deposits in Seoul are 60-80% of the property's market value.
2. What is Monthly Rent?
Monthly rent involves paying a smaller security deposit plus monthly rental payments. The deposit is smaller than jeonse, but you pay rent every month. Lower upfront costs but cumulative rental expenses over time.
3. Jeonse Pros and Cons
Pros: โ No monthly rent โก Safe storage of lump sum โข Lower living costs. Cons: โ Requires large upfront sum โก Risk of deposit non-return โข Opportunity cost (potential returns if invested elsewhere)
4. Monthly Rent Pros and Cons
Pros: โ Lower upfront costs โก Can invest lump sum elsewhere โข No deposit return risk. Cons: โ Monthly fixed expenses โก Higher long-term costs โข Potential rent increases
5. Which Should You Choose?
Choose Jeonse if: You have a lump sum, want stable housing, and have no investment alternatives. Choose Monthly Rent if: You lack a lump sum, have investment opportunities, or want flexibility. Consider monthly rent if the rental yield exceeds 5% of the jeonse deposit.