[Sunday Culture] The Unique Japanese Real Estate Practice of Paying 'Gamsageum' to Landlords

From Jeonse to Monthly Rent... Difficult to Fully Recover Deposit
Some Landlords Reflecting Japanese Culture Also Offer Bonuses

There is nothing more troublesome than finding a house. Finding a home that perfectly suits your taste is not an easy task. You end up worrying a lot until moving day. After going through various ups and downs during my move this week, I came to realize that "the best answer is to own your own home."

During the process of looking for a house, I found out that the real estate systems in Korea and Japan are quite different. Today, I want to tell you about Japan's real estate system, which is quite different from ours, such as the absence of the Jeonse system and the payment of a gratuity fee to the landlord.

First, Japan does not have the concept of Jeonse like Korea. Rent is called ‘Yachin (家賃)’ and is paid monthly, so it is essentially a monthly rent system. In Japan, Korea’s Jeonse is referred to by the katakana proper noun ‘チョンセ (Chonse)’. It is introduced as a unique rental contract method where a certain amount of deposit is paid initially and the full amount is returned at the end of the contract.

Since it is monthly rent, the deposit is not as large as Jeonse. The deposit called 'Shikikin (敷金)' is usually about two months’ rent. However, while in Korea the deposit is mostly refundable, it is a bit different in Japan. When the contract period ends and you move out, if there is damage inside the room, the cost is deducted from the Shikikin, so there is no implicit rule that the principal is fully refunded.

On the other hand, there is a unique system only in Japan. It is the gratuity fee paid to the landlord, called 'Reikin (?金)'. This is money paid as a token of gratitude to the landlord for renting the house. Naturally, it is non-refundable and simply goes to the landlord. It is usually said that landlords use it to help repay loans, but even in Japan, there are many complaints asking, "Why on earth do we have to pay this?"

Another difference from Korea is the concept of apartments. When we think of apartments, we usually imagine high-rise buildings, but in Japan, the concept is a bit different.

In the manga "Crayon Shin-chan," the old house called 'Waruru Mansion' where Shin-chan’s family temporarily lived appears. Japan distinguishes between apartments and mansions like this. Apartments usually refer to houses about two stories high, often wooden structures. Concrete buildings with three or more floors are called mansions, so in fact, Korean apartments are closer to the Japanese concept of mansions.

However, housing costs in Japan tend to be expensive. According to Sum?, Japan’s largest real estate company, the average Yachin in Tokyo’s 23 wards is 81,001 yen (780,000 won). Shibuya is 128,000 yen (1,150,000 won), and Shinjuku is 101,000 yen (915,000 won), which is a sharp increase. With 800,000 won per month, it is difficult to rent what we commonly call a 'two-room' apartment. For a place with three rooms like an apartment, the cost is about 280,000 yen (2,700,000 won). It seems inevitable that people flock to the capitals like Seoul and Tokyo.