South Korean real estate agents are set to strike for a week over government proposals to halve brokerage fees and have worries about a cheap new smartphone real estate service for buyers and renters from a chat app
South Korean estate agents are set to strike for a week over a plan by the government to halve brokerage fees.
Korea Association of Realtors members plan to strike from Monday 24 November in protest of the government’s announcement that it would force realtors to charge 50% less brokerage fees, the KoreaBizWire website reports.
According to the association, its members are being asked to shut their businesses until Sunday 30 November, but participation is not mandatory and action may alter between regions.
Meanwhile, some agents are worried about the effect of a new KakaoTalk smart phone free chat service for real estate sale and rental deals, it is reported.
KakaoTalk Real Estate, a service for agents using KakaoTalk accounts on their smartphone, carries a 0.2% fee of the property value on both rentals and purchases. The platform is particularly popular with students and young property renters,
KakaoTalk allows agents to leave their contact details in an information café so clients can call them and it is believed that around 200 have signed up to the service.
Fees that agents are allowed to charge vary, depending on the type of property and its location, but typically on house sales valued up to 50million won (US$45,000) they can earn up to 0.6% and on homes from 200million-600million won (US$180,000-US$540,000) , they can earn around 0.4%.
Agents are worried about their business being further eroded and if deals go ahead without any personal contact that there are risks of fraud and fee problems.
In August, the KakaoTalk chat app had 152million users worldwide, up 50% over the last year.
By Adrian Bishop, Editor, OPP Connect