Housing rentals for expats now thriving business

Renting housing to expatriates has turned into a booming business thanks to a rise in the number of long-term residents.

Many multi-home owners have entered the market because they are exempted from paying lease tax when their properties are rented out to foreigners under a revised government measure.

The demography of the expats show their residential areas have expanded beyond Hannam-dong and Itaewon. This also helps the business.

In Seoul, some 35,106 expats live in Yeungdeungpo, 27,204 in Guro, 17,100 in Gwanak, 12,512 in Gwangjin, 12,185 in Yongsan, 12,172 in Dongdaemun and 10,672 in Dongjak, respectively, according to the Korea Immigration Service.

Pyongtaek in Gyeongggi Province, and Songdo in Incheon, are also drawing foreign residents.

French and Europeans tend to prefer living in Sinsa-dong, southern Seoul, and Jungja-dong in Bundang, Gyeonggi Province.

Guesthouses near Gwanghwamun in downtown Seoul are popular among foreign businessmen or university exchange students who plan to visit Korea’s traditional and historic sites.

Sources say the preferred forms of residence also have become diverse.

“The foreigners used to be wealthy businessmen who lived in mansions offered by their employers, a number of them global giants” an expert said.

“But depending on jobs and income, expats now live in many different forms of homes, such as apartments, studios, guest houses, or mansions.”

“Some employers of expats pay their rent at once,” Han Tae-wook, an analyst at Daeshin Securities said.

“This means landlords can secure a large sum of money at once, whereas locals mostly pay monthly.

“Also it’s not guaranteed that the latter will be able to pay the rent on time.

The Ministry of Land, Infrastructure and Transport imposes tax on multi-home owners who rent to locals; but it excluded those who rent to foreigners.

“It’s obvious homeowners would not report to tax offices voluntarily considering they run the business to profit from monthly rents,” said a realtor in Itaewon. By Yi Whan-woo The korea times