Will homebuyers have to pay for property tours in Korea?

Apartment complexes in Seoul are seen from Namhansanseong, a mountain fortress in Gwangju, Gyeonggi Province, March 18. Yonhap

A realtor in Gyeonggi Province had an unsettling experience in February when she brought prospective homebuyers to visit a newly built apartment complex.

They asked to see units by size, so she worked hard to arrange viewings and show them around. However, they avoided questions about their intended move-in date and budget, and in the end, they failed to contact her or respond to her inquiries.

"One of my clients, who is trying to sell her home, mentioned seeing a (real-estate) study group gathering at a cafe near the complex. She asked me not to bring such visitors to her home," the realtor said. "Honestly, if I could tell them apart, I wouldn't bring them either. It's difficult to distinguish real buyers from researchers."

Such incidents are becoming common, with realtors voicing frustration over the surge in activities by so-called 'imjang' (to be present at the scene) crews."

"Imjang crews" are people who visit properties under the pretense of buying but without real intention to purchase. Instead, they scout properties for future investment opportunities or research purposes. It is a tactic that takes advantage of realtors providing detailed information to potential buyers.

The trend is especially popular among people in their 20s and 30s who are interested in real estate but lack the financial means to buy immediately.

"Isn't 'imjang' something you only do once when you're actually buying real estate? Not at all," one online study group operator wrote while recruiting members. "You can't develop an eye for good locations by visiting just once. You need to explore various neighborhoods multiple times to recognize rising areas."

Originally formed through social media and online communities, these groups have grown more organized, with platforms and academies now offering paid study sessions led by real estate professionals.

This is because, even as assets like stocks and cryptocurrencies gain popularity, many still hold an unshakable belief in real estate as an investment, believing that property prices will continue rising indefinitely.

Despite growing fears of an economic downturn, April data from the Bank of Korea revealed that consumers still expect home prices to rise over the next year.

"Showing a property requires significant time and effort, and during that time, we risk missing real clients who might visit our offices," one agent wrote in an online real estate community. "Frustrated landlords and tenants often blame us when viewings don't result in contracts."

In response, the Korea Association of Realestators (KAR) spoke up, advocating for compensation for property viewings.

"We need fair compensation for the time and services involved," said KAR Chairman Kim Jong-ho at a press meeting on Wednesday.

Real estate agencies are lined up in Seoul, April 13. Yonhap

Under the association's proposal, clients would pay a fee before viewing properties with an agent. If a transaction is finalized, the fee would be deducted from the broker’s commission. However, implementing the system would require legal amendments, as no current laws support it.

The scheme has faced growing public opposition.

"Even within the same apartment complex, the condition of homes can vary widely. If viewing fees start adding up, my chances of finding a home I truly like will shrink," Kim, a 34-year-old office worker, said. "I'm also concerned that some agents might take advantage of the system by showing unsuitable properties just to collect more fees."

The growing dissatisfaction isn't limited to consumers. Opinions within the real estate industry are also divided, with many agents warning about the risk of driving away serious buyers.

"Consumers already think brokerage fees are too high, and more are turning to direct transactions to avoid them," another agent commented online. "Adding a separate viewing fee would only accelerate this trend."

Brokerage fees can reach up to 5 million won ($3,470) for a property where the sale price is around 1 billion won. The maximum commission rate is 0.5 percent of the property price, and the fees are negotiable.

Public dissatisfaction with brokerage fees is reflected in the booming number of direct real estate transactions. The number of direct transactions surged more than 220-fold between 2021 and 2024 on Karrot Market, an online platform originally intended for secondhand goods.

As controversy mounts, KAR has adopted a more cautious tone, stating that "public consensus would have to come first."

"If realtors improve the quality of their services and genuine buyers are satisfied with them, people would be more willing to pay for those services," a real estate expert said, who spoke on condition of anonymity due to the sensitivity of the issue within the industry.

"There needs to be self-driven efforts within the industry to rebuild trust."