In Korea the broker’s fee is usually discovered after the contract is signed. Open the statute, though, and the rates turn out to be ceilings, not list prices — and the words “shall be determined by mutual agreement” are in the text itself. Negotiating is not a custom; it is the procedure the rule describes.
This article was rewritten in August 2026 from Articles 32, 33 and 49 of the Licensed Real Estate Agents Act and Article 20 of its Enforcement Rule, read directly on Korea’s National Law Information Center. Every quotation is the statutory text as written.
Four lines — (1) ⭐ the rule says the amount “shall be determined by mutual agreement” (Rule art. 20(1)); (2) housing is set by provincial ordinance, everything else by ministerial rule (Act art. 32(4)); (3) ⚠ if the agent’s own fault voids the deal, no fee is due (Act art. 32(1) proviso); (4) ⚠⚠ overcharging carries up to one year’s imprisonment or a KRW 10m fine (art. 33(1)3 → art. 49(1)10).
⭐ Where the ceiling comes from — not all of it is ordinance
Act Article 32(4) Matters necessary for the fee on brokering housing (including its land) and the limits on actual expenses shall be prescribed by ordinance of a Special City, Metropolitan City, Do or Special Self-Governing Do (“City/Do”) within the range prescribed by Ordinance of the Ministry of Land, Infrastructure and Transport, and the fee on brokering property other than housing shall be prescribed by Ordinance of the Ministry.
| Property | Who sets the ceiling | Basis |
|---|---|---|
| Housing (incl. its land) | City/Do ordinance, within Rule table 1 | Act art. 32(4) / Rule art. 20(1) |
| Officetel — 85 sqm or less + private kitchen, flush toilet and bathing facility | Rate range in Rule table 2 | Rule art. 20(4)1 |
| Everything else (retail, land, officetels failing the test) | ⭐ Within 9/1000 (0.9%) of the price | Rule art. 20(4)2 |
⭐⭐ “Rates are set by provincial ordinance” is true only for housing. Retail units and land go through ministerial rule instead, and that rule states the figure directly: “within 9/1000 of the transaction price.”
⭐⭐⭐ Officetels are conditional — 85 sqm or less with a private kitchen, private flush toilet and bathing facility. Fail the test and you are on the 0.9% track.
⚠⚠ Shop-houses split by floor area (Rule art. 20(6)) — housing at half or more of the area uses the housing rule; under half uses the other rule.
⚠ We could not open tables 1 and 2 themselves (annexed tables do not appear on the per-article page). So this article contains no housing rate figures.
⭐⭐⭐ “Determined by mutual agreement” — those are the words
Rule Article 20(1) The fee for brokering housing under Act Article 32(4) shall be received from each of the two parties separately, and the limit receivable from one party is as set out in table 1; the amount shall be determined by mutual agreement between the client and the agent, within the rate limit prescribed by City/Do ordinance.
- ⭐⭐⭐ “Determined by mutual agreement” is the operative wording. It is not “here is a ceiling, haggle if you dare” — the rule is built around the amount being agreed.
- ⭐ It is “from each of the two parties separately.” Seller and buyer each pay; table 1’s limit is what may be taken from one party.
- ⚠⚠ Agree before signing. The rule fixes no time for the agreement, and the timing of payment is delegated to Presidential Decree (Act art. 32(3)). ⚠ We did not open that Decree provision.
- ⭐⭐ What if the office is in a different province from the property? Rule Article 20(3) answers: the standard is “the ordinance of the City/Do with jurisdiction over the location of the brokerage office.” Not where the property is — where the office is.
⭐ How the transaction price is counted — the conversion rule is in the text
Rule Article 20(5) … the transaction price shall be calculated as follows:
1. Where a lease has rent in addition to a deposit, the transaction price is the deposit plus the monthly rent multiplied by 100. Provided, that where that sum is under KRW 50m, the transaction price is the deposit plus the monthly rent multiplied by 70.
2. For an exchange contract, the transaction price is the value of the larger property.
3. Where two or more transactions including a sale are made on the same property between the same parties on the same occasion, only the sale price applies.
| Deal type | Transaction price | Basis |
|---|---|---|
| Sale | The sale price | — |
| Jeonse (deposit only) | The deposit | — |
| Monthly rent — converted sum KRW 50m or more | Deposit + (rent × 100) | Rule art. 20(5)1 |
| Monthly rent — converted sum under KRW 50m | ⭐ Deposit + (rent × 70) | |
| Exchange | Value of the larger property | Same para., 2 |
| Same property, parties and occasion, two or more deals | ⭐ Only the sale price | Same para., 3 |
⭐ Worked through — a KRW 10m deposit with KRW 500,000 rent gives 10m + (500,000 × 100) = KRW 60m, which is over 50m, so 60m stands. But a KRW 5m deposit with KRW 300,000 rent gives 5m + 30m = 35m, under 50m, so it recalculates as 5m + (300,000 × 70) = KRW 26m (our own calculation). The proviso pushes the price down. The conversion itself is covered in our deposit-to-rent converter.
⚠ Actual expenses — who gets billed differs
Act Article 32(2) An agent may receive from a client the actual expenses incurred in verifying the rights over the property or in securing performance of the obligation to return the deposit.
Rule Article 20(2) … the limit on actual expenses shall be that cost, and the agent may bill it, attaching receipts, to the client seeking to transfer rights by sale or lease (or, in the case of expenses for securing return of the deposit, to the client seeking to acquire rights by purchase or lease).
- ⭐⭐ There are only two categories of expense — verifying rights and securing return of the deposit. The statute lists nothing else.
- ⭐⭐⭐ The billing target differs — rights verification goes to the seller or landlord; deposit-return security goes to the buyer or tenant. Charging a tenant for the register search does not match the wording.
- ⚠ “Attaching receipts” is a condition. Taking money as “expenses” with no receipt does not meet the rule. Pulling the register yourself is covered in our property register guide.
⚠⚠ Overcharging — a criminal offence, not a fine
Act Article 33(1) An agent shall not do any of the following:
3. Receiving money or goods in excess of the fee or actual expenses under Article 32, under any name whatsoever, including gratuity or gift
Act Article 49(1) Any of the following persons shall be punished by imprisonment for not more than one year or a fine not exceeding KRW 10m:
10. A person who violates Article 33(1)1 through 4
⚠⚠⚠ “Under any name whatsoever” is the key phrase — contract drafting fee, document handling fee, gratuity, thank-you money: any label is still an overcharge. The statute pre-empts the naming game.
⚠⚠ And Article 49(1)10 connects it to up to one year’s imprisonment or a KRW 10m fine. Criminal, not administrative.
⭐ For non-housing there is also a disclosure duty (Rule art. 20(7)) — the agent must state the ceiling rate they actually intend to charge on the posted rate and limit table and may not exceed it. Photograph the table on the office wall and you have your evidence.
| Type of payment | What the statute allows | If breached |
|---|---|---|
| Brokerage fee | By agreement, within the ordinance / table / 0.9% ceiling | ⚠⚠ Up to 1 year’s imprisonment or KRW 10m fine (art. 33(1)3 → art. 49(1)10) |
| Actual expenses | ⭐ Only rights verification and deposit-return security, with receipts | |
| Drafting fees, document fees, gratuities | ⚠ Not in the statute — caught by “any name whatsoever” | Same provision |
⭐ If the deal falls apart — there is a proviso
Act Article 32(1) An agent shall receive the prescribed fee from the client for brokerage services. Provided, that this shall not apply where the transaction between the clients is void, cancelled or rescinded due to the agent’s intent or negligence.
⭐⭐ One proviso flips the outcome. If the agent’s intent or negligence made the deal void, cancelled or rescinded, no fee is due. ⚠ The test for “intent or negligence” is not in the statute, and we did not check case law.
Questions that keep splitting opinion
Can I ask for a discount?
⭐ The rule says the amount is “determined by mutual agreement” (Rule art. 20(1)). It is closer to setting the fee than cutting it. That said, the rule fixes no time for the agreement, so settle it before signing.
Can VAT be added on top?
⚠ Neither the Act nor the Rule mentions VAT. That sits under the Value-Added Tax Act, which we did not open, so we do not assert an answer. The common explanation that it depends on whether the agent is a general or simplified taxpayer is widespread but we could not verify it against the text.
Does the fee count as a necessary expense for capital gains tax?
⚠ Nothing in this Act addresses that. Deductibility is governed by the Income Tax Act — see our capital gains tax guide. Either way, no receipt means no claim.
How is a pre-completion apartment right calculated?
⚠ Rule Article 20(5) has no subparagraph for it. The common “amount paid so far plus premium” explanation is not confirmed by this provision, so we do not state it.
Can I get an overpayment back?
⚠ Article 33 stops at “shall not,” and contains no sentence about restitution. We could not confirm the basis for recovering an overpayment. What is confirmed is that it is a criminal offence under Article 49(1)10. Pre-contract checks are in our apartment purchase guide and jeonse contract checklist.
The rate is a ceiling, not a list price, and the rule says the amount inside it is determined by agreement. Whatever name it is given, taking more than the ceiling is a criminal offence.
Sources
- ⭐⭐⭐ Ministry of Government Legislation, National Law Information Center — statutory text — Licensed Real Estate Agents Act Enforcement Rule, Article 20 (Limits on Fees and Expenses). Source of paragraph (1) “determined by mutual agreement,” (2) on who is billed, (3) on the office’s location, (4) on officetels and the 0.9% cap, (5) on transaction price, (6) on shop-houses, and (7) on disclosure.
- ⭐⭐⭐ Ministry of Government Legislation, National Law Information Center — statutory text — Licensed Real Estate Agents Act, Article 32 (Brokerage Fees). Source of the paragraph (1) proviso, paragraph (2) on expenses, and paragraph (4) splitting housing and non-housing.
- ⭐⭐ Ministry of Government Legislation, National Law Information Center — statutory text — Same Act, Article 33 (Prohibited Acts). Source of paragraph (1)3, “under any name whatsoever … in excess.”
- ⭐⭐ Ministry of Government Legislation, National Law Information Center — statutory text — Same Act, Article 49 (Penal Provisions). Basis for paragraph (1)10 connecting Article 33(1)1–4 to one year’s imprisonment or a KRW 10m fine.
What we could not confirm
- ⚠⚠ The actual rate tables for housing and officetels. Annexed tables 1 and 2 do not appear on the per-article page, so this article contains no housing rate figures.
- ⚠⚠ Each province’s ordinance rate limits. Ordinances are not statutes and do not open on the National Law Information Center. Check each City/Do site.
- ⚠ Whether VAT may be charged separately. Not in this Act; the VAT Act was not opened.
- ⚠ How to price a pre-completion apartment right. Rule Article 20(5) has no such subparagraph.
- ⚠ The basis for recovering an overpayment. Article 33 sets only a prohibition, with no restitution clause.
- When the fee becomes payable. Act Article 32(3) delegates it to Presidential Decree, which we did not open.
- The test for “intent or negligence.” Not in the statute; case law not checked.
Written as of August 2026. ⭐ All quotations are the statutory text as published by the National Law Information Center, and what we could not confirm is listed separately above. ⚠ Housing rates are set by City/Do ordinance and therefore differ by region — before signing, check the rate table for the province where the brokerage office is located. Disputes can be raised with the local district office. This article is general information, not legal advice.
