Hong Life CalculatorsUnderstanding the rent increase calculator — concept and principle
This calculator applies a proposed rent increase to your monthly rent and deposit and checks it against a legal or contractual cap. It shows the new rent, the extra cost per year and how much a proposal exceeds the cap.
How it is calculated
- New rent = current rent × (1 + increase %); the same percentage is applied to the deposit.
- Increase per month = new rent − current rent; extra rent per year = that × 12.
- Highest amount under a cap = current amount × (1 + cap %).
- Rent above the cap = new rent − highest rent under the cap.
The principle
Rent caps limit how much a landlord can raise the rent at one time. In Korea, under the Housing Lease Protection Act (article 7), a request to raise the rent or deposit on a home may not exceed one twentieth (5%) of the agreed amount, may not be made within one year of the contract or the last increase, and a city or province may set a lower cap by ordinance. Other countries and cities have their own rules, so enter your local cap or 0 if there is none.
Worked example
Default inputs: rent 1,200 USD a month, deposit 2,400 USD, proposed increase 7%, cap 5%.
- New rent = 1,200 × 1.07 = 1,284.00 USD; increase = 84.00 USD a month, 1,008.00 USD a year.
- New deposit = 2,400 × 1.07 = 2,568.00 USD.
- Highest rent under the 5% cap = 1,200 × 1.05 = 1,260.00 USD; highest deposit = 2,520.00 USD.
- Rent above the cap = 1,284 − 1,260 = 24.00 USD a month: above the cap.
| Current rent per month | New rent per month |
|---|---|
| 300 | $321.00 |
| 600 | $642.00 |
| 900 | $963.00 |
| 1,200 | $1,284.00 |
| 1,500 | $1,605.00 |
| 1,800 | $1,926.00 |
| 2,400 | $2,568.00 |
How to read the result
If a proposal is above the cap, you can point to the rule and the maximum amount. Even within a cap, compare the new rent with similar homes nearby to decide whether to renew or move, including moving costs in your comparison.
Common mistakes
- Applying the cap to the wrong base (for example to the market rent instead of the current agreed rent).
- Forgetting that in Korea the 5% cap applies to increase requests during a contract and to renewals under the renewal-request right, not to a brand-new contract with a different tenant.
- Ignoring local ordinances that set a lower cap.
- Treating a cap as a guaranteed increase; it is a maximum.
Frequently asked questions
How much can rent increase in Korea?
Under the Housing Lease Protection Act, an increase request is limited to 5% of the agreed rent or deposit, and not within one year of the last change.
Does the cap apply to the deposit too?
In Korea the 5% limit applies to both rent and deposit.
How do I calculate a rent increase percentage?
(New rent − old rent) ÷ old rent × 100.
Sources: 주택임대차보호법 제7조 (차임 등의 증감청구권) · 주택임대차보호법 제6조의3 (계약갱신 요구 등)