How it works
Korean rentals trade deposit for rent. Wolse (월세) means a deposit plus monthly rent. Jeonse (전세) means one very large deposit and no rent at all. Most landlords will move along that line: more deposit, less rent.
The conversion rate
Monthly rent change = deposit change × conversion rate ÷ 12
At 5%, every ₩10 million of extra deposit should cut rent by about ₩41,667 a month. When a landlord turns part of your deposit into rent during an existing lease, the law caps the rate at the lower of 10% or the Bank of Korea base rate plus 2%p. The base rate has been 3.00% since 27 August 2026. For new leases the rate is open to negotiation, and the market rate in Seoul is often higher.
Which is cheaper?
Compare the rent you pay with the interest your deposit could have earned in a savings account. If the conversion rate is higher than your savings rate, a bigger deposit saves money, as long as you can be sure to get the deposit back.
A large deposit is only safe when the building's debts are low. Check the registry (등기부등본) before paying, and register your lease at the community center for a fixed date (확정일자) on moving day.
Frequently asked questions
Can foreigners rent with jeonse?
Yes. Foreign residents with an ARC can sign jeonse leases and register for deposit protection the same way Koreans do. Bank loans for jeonse are harder to get as a foreigner.
What does key money mean in Korea?
Key money is the expat term for the deposit (보증금). It is returned at the end of the lease, minus any unpaid rent or damage.
Does the cap apply to a new lease?
No. The legal cap is for converting deposit to rent during an existing lease or a renewal. New leases are a free negotiation, so use the calculator to check whether an offer is fair.
Sources: Housing Lease Protection Act art. 7-2 and Enforcement Decree art. 9 · Bank of Korea base rate (27 August 2026)
Last checked: 2026-10-19. Figures are updated every January.