Real Estate Brokerage Fees — Rate Cap Tables and Monthly Rent Formula

Real estate brokerage fees (the legal term is junggebossu, or brokerage remuneration) are not a fixed price. What the law sets is a rate cap by transaction amount bracket, and the actual remuneration is negotiated between the broker and client within that ceiling. The calculation structure itself is simple — transaction amount × rate. However, monthly rent has a separate formula for converting the transaction amount, and officetels use a different rate.

The calculation steps for sales, leases, monthly rent, and officetels are laid out below based on the rate table published by the City of Seoul. Since the cap on residential brokerage remuneration is set by ministerial enforcement rules and local government ordinances, transactions outside Seoul should also cross-reference the relevant local government's notice for accuracy.

The Rate Cap — Not the Amount to Receive, But the Line That Cannot Be Crossed

As EasyLaw (찾기쉬운 생활법령정보) explains, the figure in the rate table is the legal maximum a licensed agent may charge. Negotiating a lower amount within the cap is freely permitted; charging above the cap is a legal violation.

This is why agreeing on the remuneration amount in advance before signing the contract is the first step to avoiding disputes. Rate tables are posted at brokerage offices, so the calculation basis can be verified on the spot together.

Some brackets include a maximum amount (handoaek). In those cases, the cap is whichever is smaller between "transaction amount × rate" and the maximum amount. For example, on a 40 million KRW low-value sale, 0.6% yields 240,000 KRW, which is less than the 250,000 KRW ceiling, so 240,000 KRW is the cap — but once the transaction amount rises even slightly, the ceiling begins to cut off the calculated value.

The figure in the rate table is not the amount to be received — it is the line that cannot be crossed. Brokerage remuneration is an amount negotiated within that ceiling.

Rate Tables — Sales and Leases

The residential brokerage remuneration rate caps posted at Seoul Real Estate Information Plaza are as follows. First, for sales and exchanges:

For leases (jeonse or monthly rent), the rate is one step lower for the same transaction amount.

For example, on a 600 million KRW apartment sale, the "200 million ~ under 900 million KRW" bracket applies at 0.4%, giving a cap of 2.4 million KRW. For a 400 million KRW jeonse contract, the "100 million ~ under 600 million KRW" bracket applies at 0.3%, cap of 1.2 million KRW. In both cases, there is no maximum amount in the bracket, so the calculated rate value is directly the cap.

It is also worth noting that rates change in steps at bracket boundaries. In sales, 890 million KRW falls under 0.4% (cap 3.56 million KRW), but once it exceeds 900 million KRW, it jumps to the 0.5% bracket, making the cap for a 1 billion KRW transaction 5 million KRW. If the transaction amount is near the 900 million, 1.2 billion, or 1.5 billion KRW boundaries, the first step is to confirm which bracket applies.

Monthly Rent — Convert to Equivalent Deposit: Deposit + Monthly Rent × 100

For monthly rent contracts, the transaction amount is calculated as deposit + (monthly rent × 100). However, if the resulting amount is under 50 million KRW, it is recalculated as deposit + (monthly rent × 70) — this rule is explicitly stated in the Seoul rate table.

• Deposit 10 million KRW, monthly rent 500,000 KRW — 10 million + 50 million = 60 million KRW. Since it is 50 million or above, it stays as is. In the lease 0.4% bracket, the cap is 240,000 KRW (within the 300,000 KRW maximum).
• Deposit 5 million KRW, monthly rent 300,000 KRW — 5 million + 30 million = 35 million KRW, which is under 50 million. Recalculate with ×70: 5 million + 21 million = 26 million KRW. In the 0.5% bracket, the cap is 130,000 KRW (within the 200,000 KRW maximum).

As the second example shows, the ×70 recalculation rule works to lower the fee for small monthly rent contracts. Since both the bracket and the maximum amount change depending on which multiplier applies, for monthly rent contracts the correct first step is an accurate conversion.

Officetels and VAT

Officetels do not follow the residential rate table. Per Seoul's guidelines, for officetels with exclusive-use area of 85 m² or less that are equipped with a dedicated kitchen, bathroom, and other residential fixtures, the cap is 0.5% for sales and 0.4% for leases; for units that do not meet these requirements, the rate is negotiated within 0.9%.

VAT is charged in addition to the brokerage fee. If the final invoice differs from the amount calculated from the rate table, check first whether VAT has been added, and keep a receipt (cash receipt, etc.) after payment.

Checklist

• Whether the fee amount (or rate) was agreed upon before signing — check the brokerage fee entry on the brokerage object confirmation and explanation form
• Whether the transaction amount falls near a bracket boundary of 900 million, 1.2 billion, or 1.5 billion KRW — the rate changes when the bracket changes
• For monthly rent: whether the converted amount (deposit + monthly rent × 100) is under 50 million KRW — determines whether the ×70 recalculation applies
• For officetels: whether the residential-use conditions are met (exclusive area ≤85 m², dedicated kitchen and bathroom)
• For transactions outside Seoul: the rate table in the relevant local government's ordinance — cross-reference via the local government website
• Whether VAT is charged separately and whether a receipt was issued

References

• Seoul Real Estate Information Plaza — Brokerage Remuneration
• EasyLaw — Calculation of Real Estate Brokerage Remuneration