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Buying new pre-sale apartments in South Korea requires substantial capital, with down payments ranging from 40-70% for foreign buyers.
Seoul commands premium prices at KRW 13.4 million ($9,250) per square meter, while construction timelines typically span 2-4 years from contract to completion.
If you want to go deeper, you can check our pack of documents related to the real estate market in South Korea, based on reliable facts and data, not opinions or rumors.
New pre-sale apartments in South Korea require significant upfront investment, with Seoul averaging KRW 13.4 million per square meter and foreign buyers needing 40-70% down payments.
Construction timelines span 2-4 years, with mortgage rates around 3.98-7% for qualified foreign buyers, while rental yields in Seoul average 1.7-2.5%.
| Aspect | Seoul | Other Major Cities |
|---|---|---|
| Price per sqm | KRW 13.4 million ($9,250) | KRW 6.69-6.71 million ($4,620-4,635) |
| Down Payment (Foreigners) | 50-70% | 40-60% |
| Mortgage Interest Rate | 3.98-7% | 3.98-7% |
| Construction Timeline | 2-4 years | 2-4 years |
| Rental Yield | 1.7-2.5% | 2.5-4% |
| Additional Costs | 2.2-7% total | 2.2-7% total |
| Common Unit Sizes | 59-101 sqm | 59-101 sqm |
What is the average price per square meter for new pre-sale apartments in South Korea?
New pre-sale apartment prices in South Korea vary dramatically by location, with Seoul commanding the highest premiums in the market.
The national average for new apartments stands at KRW 5.76 million ($3,980) per square meter as of September 2025. Seoul significantly exceeds this benchmark, averaging KRW 13.4 million ($9,250) per square meter across all districts.
Prime Seoul locations like Gangnam, Seocho, and Songpa districts reach KRW 18-40 million ($12,400-$27,600) per square meter for luxury pre-sale developments. Secondary cities offer more affordable options, with Busan averaging KRW 6.69 million ($4,620) and Daegu at KRW 6.71 million ($4,635) per square meter.
Emerging districts in Seoul's outskirts, such as areas near new subway extensions, typically price between KRW 8-12 million ($5,530-$8,290) per square meter for new developments.
These prices reflect the exclusive area measurements used in South Korea, which calculate net living space rather than total built area.
What is the minimum down payment required for pre-sale units and what percentage does it represent?
Foreign buyers face significantly higher down payment requirements compared to Korean nationals when purchasing pre-sale apartments.
Korean citizens typically need 30-50% down payments for new pre-sale units, while banks require foreign buyers to provide 40-70% of the total purchase price upfront. Seoul and other premium markets lean toward the higher end of this range, often demanding 60-70% from international buyers.
For a KRW 1 billion ($690,000) apartment in Seoul, foreign buyers should prepare KRW 600-700 million ($414,000-$483,000) as a down payment. The remaining balance gets financed through a mortgage, subject to strict qualification criteria.
Some developers offer staged payment plans where buyers pay 10-30% upon contract signing, with additional payments due at construction milestones before the final down payment at completion.
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What financing options are available to foreigners and what are current mortgage rates?
Mortgage access for foreigners in South Korea is strictly regulated, with limited options available through major banks.
| Bank | Foreigner Lending | Requirements |
|---|---|---|
| KB Kookmin Bank | Available with restrictions | F2/F4/F6 visa, Korean income proof |
| Shinhan Bank | Limited programs | Long-term visa, local credit history |
| Woori Bank | Case-by-case basis | Employment verification, Korean tax records |
| Hana Bank | Selective lending | Minimum 2-year residency, stable income |
| NH Bank | Agricultural focus | Rural property preference |
| IBK Bank | SME clients priority | Business ownership in Korea |
| Standard Chartered | International clients | High net worth requirements |
Mortgage interest rates for new loans range from 3.98% to 7% as of September 2025, depending on the bank, loan amount, and borrower's profile. Foreign buyers typically receive rates at the higher end of this spectrum.
What are typical construction timelines for new developments in South Korea?
Construction timelines for pre-sale apartments in South Korea typically span 2-4 years from contract signing to move-in.
Large-scale developments with 1,000+ units often require 3-4 years for completion, while smaller projects of 200-500 units may finish within 2-3 years. Complex projects involving mixed-use developments or extensive infrastructure work can extend beyond 4 years.
Seoul projects face additional delays due to stricter building regulations, environmental assessments, and permit processing that can add 6-12 months to the timeline. Developers typically provide quarterly progress updates and estimated completion dates.
Weather conditions, particularly harsh winters, can slow construction progress by 2-3 months annually. The COVID-19 pandemic has also introduced potential delays, though most projects have adapted their schedules accordingly.
Pre-sale contracts include penalty clauses if developers exceed agreed completion dates by more than 6 months without valid reasons.
What are the most common floor plans and unit sizes available?
South Korean pre-sale developments offer standardized floor plans based on exclusive area measurements that focus on livable space.
The most common unit sizes are 59㎡, 84㎡, and 101㎡ exclusive area, marketed as 2-bedroom, 3-bedroom, and 4-bedroom apartments respectively. These sizes accommodate Korean family preferences and maximize land use efficiency.
Smaller units of 33-49㎡ target singles and young couples, while larger 134㎡+ units serve affluent families seeking premium space. Most developments include a mix of sizes to appeal to diverse buyer segments.
Standard layouts feature separate bedrooms, combined living-dining areas, enclosed kitchens, and 1-2 bathrooms. Premium units include walk-in closets, separate powder rooms, and balcony spaces.
Budget alignment depends heavily on location - a 84㎡ unit costs KRW 1.1 billion ($760,000) in Seoul versus KRW 560 million ($387,000) in Busan for similar quality developments.
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What government restrictions apply to foreigners buying pre-sale units?
Foreign buyers can purchase new pre-sale apartments in South Korea without quota restrictions, but must comply with specific reporting and registration requirements.
All foreign buyers must obtain a real estate registration number through Korean Immigration Services and report transactions to the Bank of Korea within 60 days of contract signing. This process requires passport verification, visa status confirmation, and transaction documentation.
Certain restricted areas near military installations or government facilities prohibit foreign ownership entirely. Agricultural land and forest areas also remain off-limits to most foreign buyers.
Banks impose stricter mortgage qualification criteria for foreigners, including minimum income thresholds, longer residency requirements, and enhanced documentation standards compared to Korean nationals.
Foreign buyers benefit from the same legal protections as Korean citizens regarding construction quality, completion timelines, and developer obligations under Korean real estate law.
What are the expected additional costs when buying pre-sale units?
Additional costs for pre-sale apartment purchases in South Korea typically total 2.2-7% of the property value, depending on price and location.
- Registration tax: 1.1-3.5% based on property value brackets
- Acquisition tax: 1.1-3.5% depending on area designation and property type
- Realtor commissions: 0.5-0.9% plus 10% VAT
- Legal fees: 0.3-0.5% for contract review and registration
- Property inspection: KRW 300,000-800,000 ($207-$552)
Maintenance fees begin upon completion, typically ranging from KRW 80,000-200,000 ($55-$138) per month for standard units. Premium developments with extensive amenities may charge KRW 300,000+ ($207+) monthly.
Foreign buyers may incur additional costs for translation services, visa documentation, and international wire transfer fees that can add KRW 2-5 million ($1,380-$3,450) to the total transaction cost.
What is the projected resale value and price appreciation for pre-sale units?
Resale values for pre-sale apartments in South Korea show strong performance in Seoul, with more modest appreciation in secondary cities.
Seoul apartment prices have appreciated 18% year-over-year in 2025, significantly outpacing national average growth of 8-12%. Prime districts like Gangnam, Seocho, and Songpa continue leading appreciation due to limited supply and strong demand.
Historical data shows Seoul apartments have appreciated 40-60% over the past 5 years, while secondary cities like Busan and Daegu have seen 20-35% growth during the same period. New developments typically outperform older stock due to modern amenities and energy efficiency.
Pre-sale units often appreciate 10-20% from contract signing to completion in strong markets, providing immediate equity gains for buyers. However, this depends heavily on overall market conditions and specific location factors.
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We did some research and made this infographic to help you quickly compare rental yields of the major cities in South Korea versus those in neighboring countries. It provides a clear view of how this country positions itself as a real estate investment destination, which might interest you if you're planning to invest there.
What is the average rental yield and how quickly do units get rented?
Rental yields in South Korea vary significantly by location, with Seoul offering lower yields but faster rental turnover compared to other cities.
Seoul apartments generate average gross rental yields of 1.7-2.5%, reflecting high property values relative to rental income. Secondary cities like Busan, Daegu, and Gwangju offer higher yields of 2.5-4% due to lower purchase prices.
New units in central Seoul districts typically rent within 2-4 weeks of completion, driven by strong demand from young professionals and expatriates. Suburban locations may require 1-3 months to find suitable tenants.
University areas and business districts maintain consistently high rental demand, with vacancy rates below 2-3% for quality new developments. Family-oriented neighborhoods see more seasonal variation in rental activity.
The jeonse deposit system, where tenants provide large lump-sum deposits instead of monthly rent, remains popular and can offer additional investment returns through deposit investment opportunities.
What penalties apply if buyers cancel pre-sale contracts?
Pre-sale contract cancellations in South Korea typically result in forfeiture of deposits, with escalating penalties based on construction progress.
Early-stage cancellations within 30 days usually forfeit 10% of the total contract value as penalty fees. Mid-construction cancellations may increase to 15-20% penalties, while late-stage cancellations near completion can cost 25-30% of the purchase price.
Some contracts allow partial recovery if buyers find replacement purchasers willing to assume the contract at the same terms. This process requires developer approval and may involve additional administrative fees.
Buyers experiencing financial hardship may negotiate payment plan modifications or contract transfers rather than outright cancellation to minimize losses. Developers occasionally offer alternative units within the same project as substitution options.
Contract terms vary by developer, making thorough review essential before signing. Legal consultation is advisable to understand specific penalty structures and potential alternatives.
What are the main risks and buyer protections for pre-sale purchases?
Pre-sale apartment purchases in South Korea carry construction and developer risks, but comprehensive legal protections exist to safeguard buyer investments.
| Risk Type | Protection Mechanism | Coverage Level |
|---|---|---|
| Developer bankruptcy | Deposit insurance fund | Up to KRW 300 million per unit |
| Construction delays | Penalty clauses in contract | Monthly compensation after 6-month delay |
| Quality defects | Mandatory warranty period | 10-year structural, 2-year finish work |
| Fund misappropriation | Government trust accounts | 100% of pre-construction payments |
| Design changes | Buyer approval required | Major changes require consent |
| Market fluctuations | Contract price guarantee | Fixed pricing regardless of market changes |
| Permit issues | Developer liability | Full refund if permits denied |
The Korean government requires large projects to maintain trust accounts that segregate buyer funds from developer operations, preventing misuse of pre-sale proceeds. Regular construction progress inspections ensure compliance with building standards and timeline commitments.
What government subsidies and programs exist for pre-sale buyers?
South Korea offers limited subsidies for pre-sale apartment purchases, with most programs targeting Korean nationals rather than foreign buyers.
First-time homebuyer programs provide acquisition tax reductions of 0.5-1% for Korean citizens purchasing their first property under KRW 900 million ($621,000). Newlywed couples receive additional benefits including extended mortgage terms and reduced interest rates.
Some local governments offer property tax reductions for new developments that include affordable housing units or contribute to urban regeneration projects. These benefits typically last 3-5 years after completion.
Foreign buyers generally cannot access Korean housing subsidies, but may benefit from reduced acquisition taxes in designated development zones aimed at attracting international investment.
It's something we develop in our South Korea property pack.
Conclusion
This article is for informational purposes only and should not be considered financial advice. Readers are advised to consult with a qualified professional before making any investment decisions. We do not assume any liability for actions taken based on the information provided.
Buying new pre-sale apartments in South Korea requires substantial capital and thorough market research, particularly for foreign investors facing higher down payment requirements and stricter financing conditions.
While Seoul offers the strongest appreciation potential and rental demand, the high entry costs and limited mortgage access make secondary cities attractive alternatives for international buyers seeking better yields and lower barriers to entry.
Sources
- Average apartment price per square meter in South Korea
- Average apartment price per square meter in Seoul
- Reddit discussion on purchasing homes in Korea
- Mortgages in Korea discussion
- Moving to South Korea and buying property
- South Korea mortgage interest rates
- South Korea property price history
- South Korea real estate market analysis