What is the maximum real estate brokerage fee?

What the Law Says

South Korean law strictly limits how much a real estate broker can charge for facilitating property sales or leases. The Real Estate Brokerage Act sets both percentage-based caps and absolute ceilings depending on property type and transaction value.

Under the Real Estate Brokerage Act, brokers may charge a commission of up to 0.7% of the transaction price for residential real estate sales. For non-residential properties (e.g., commercial or industrial), the cap is 1.0%.

However, even if 0.7% exceeds ₩6 million, the broker cannot collect more than ₩6 million for a single residential transaction. This absolute cap applies regardless of property value.

If a broker collects more than the legal limit, the excess amount must be refunded to the client within 30 days of demand. Failure to refund triggers a penalty equal to 5% of the overcharged amount.

The law also requires brokers to disclose the exact fee calculation in writing before signing any brokerage agreement.

Statutory Text

The brokerage fee for residential real estate transactions shall not exceed 0.7 percent of the transaction price, provided that it shall not exceed six million won.

— Real Estate Brokerage Act, Art. 34 — Brokerage Fee Limitation

Statutory Text

Where a real estate broker receives a brokerage fee exceeding the amount prescribed in Article 34, the broker shall refund the excess amount to the client within thirty days upon request.

— Real Estate Brokerage Act, Art. 35 — Refund of Excess Fee

Statutory Text

A real estate broker who fails to refund the excess brokerage fee under Article 35 shall pay a penalty equal to five percent of the excess amount.

— Real Estate Brokerage Act, Art. 36 — Penalty for Non-refund

What to Do

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