Rent conversion rate
Korean: 전월세 전환율
The legal cap on the rate used to turn part of a deposit into monthly rent during a lease.
When a deposit is converted into monthly rent during a lease, the rate may not exceed the lower of 10% a year or the Bank of Korea base rate plus 2 percentage points (Housing Lease Protection Act, Art. 7-2, Enforcement Decree Art. 9).
With the base rate at 3.0% (decided October 22, 2026), the cap is 5% a year: converting ₩100 million of deposit gives at most about ₩416,667 a month.
Legal basis
Explanations follow the current Korean statutes on the National Law Information Center (law.go.kr). Laws change, so check the original text before relying on it. This is general information, not legal advice. All terms
Korean version: 한국어 용어사전