Public housing gets more genteel
This milestone comes 46 years after the government started to offer low cost rental apartments to low-income families in 1971.
Park Sang-woo, Korea Land & Housing Corporation (LH) President, last month said the government will continue to provide such apartments and upgrade their quality as well.
Improvements were particularly noticeable during the Park Geun-hye administration, which championed so-called New Stay developments, in which private construction companies built affordable apartments on government-owned land.
The private builders introduced high-quality facilities and services into public housing.
“The [government-supplied] apartments built these days have changed so much, they no longer look like apartments for those who don’t own or those that are poor,” said Ham Young-jin, head of the research center at real estate information provider Budongsan 114. “Unlike in the past, these apartments are good quality and located in areas with good transportation access. They are equipped with various convenient facilities.”
One notable change is apartment size.
Previously, public apartments for newlyweds were a single room of 20 to 30 square meters (215 to 323 square feet). Today they boast two rooms and 40 square meters of total space.
“Once newlyweds move into such low-cost rentals, they tend to stay for more than 10 years,” said Kim Chul-hong, head of the public housing policy bureau at the Ministry of Land, Infrastructure and Transport. “When they have a child they will need two rooms so we advised [the construction companies] to expand the apartments.”
The design of the apartments has changed too. For an older family, the LH’s standard design is an 84 square-meter apartment with three bedrooms and a joint living room and kitchen.
In the case of LH’s complex in Dongtan 2 New City in Hwaseong, Gyeonggi, the developer has decided to vary the height of the buildings depending on the land they are built on, avoiding the uniformity of past public housing developments which were nicknamed “matchboxes.”
The New Stay apartment that Hyundai E&C is building in Homaesil-dong in Suwon has increased the number of closets, including one in the apartment’s entrance and a pantry in the kitchen. The main bedroom has a walk-in closet.
“We have a sports field, a jogging track as well as community facilities such as kids cafe, a fitness center and an indoor golf range,” said a Hyundai E&C official.
Smart home technologies are also built into these apartments.
Residents of LH’s Central Hill apartment in Okgil, Bucheon, which opened in July, can adjust the lighting and room temperature via smartphone or voice command. They can order the elevator to their floors and automatically view their energy consumption.
Hanwha E&C’s Dream & Green apartment in Suwon, which is scheduled to be completed early next year, will offer solar energy generators and other environmentally friendly features.
There’s more variety in the sizes of public housing units too. In the past most residents were families of three or four. But the units being built today are for smaller families of one or two people.
These are supposed to be housing opportunities for young people including newlyweds, college students and people new to the working world who can’t afford other kinds of apartments.
Lotte E&C’s Lotte Castle apartments in Dongtan, Gyeonggi, will run a so-called “Castle Link” program that allows residents to change the size of their apartment as their family changes. They notify the administration if a child is due, or if a college kid is going out to live on his or her own, and they will be given priority when a vacancy at a more suitable apartment comes around.
The apartment also provides rental services for home appliances such as TVs, refrigerators, washing machines, air conditioners and air purifiers.
Daewoo E&C’s Purugio apartment in Dongtan, which is scheduled to be completed next year, will be providing a shared-economy service through which residents can borrow cars and bicycles.
It will also be implementing a joint study program for children living in the apartment complex and running a small farm where residents can jointly raise organic vegetables and fruits.
As the quality and services of these low-cost apartments have changed, so has the public’s view of them.
In the past many people were against the construction of public housing in their neighborhoods because they believed it would drive down the value of the apartments nearby.
In some cases, projects were cancelled due to protests from neighbors.
The change in reputation was noticeable during the application process for the first New Stay apartments by Daelim Industries in September 2015. The company got 5.5 offers for every unit being rented. The most popular apartment, which was the smallest at 59 square meters, drew 6.5 bids for every unit. More than 3,500 people competed for 549 units.
However, there are some complaints that the rents on the New Stay apartments are relatively high despite the government providing various benefits to the developers including wider access to public housing projects.
The deposit on an 84 square-meter apartment for Daelim Industries’ New Stay apartment in Incheon is 65 million won with monthly rent at 550,000 won.
The same size apartment in non-public housing requires only a 30 million won deposit with 600,000 won in monthly rent.
An 84 square-meter New Stay apartment in Wirye New City on the southeastern border of Seoul requires a 445 million won deposit and a 440,000 won monthly rental payment.
“The intention of the [New Stay] system was good but the benefits given to the builders is higher than those given to the public,” said Kim Seong-dal of the Citizens’ Coalition for Economic Justice civic group.
Later this month, the government is planning to announce new public housing policies, which are expected to include the addition of 170,000 low-cost apartments every year until 2021.
It is also expected to tinker with the New Stay apartments. Priority is expected to be given to newlyweds and people who don’t own real estate, and rents are expected to be lower than neighboring apartments.
There’s even a discussion over whether to keep the name “New Stay.”
But some market analysts warn of sudden policy changes that could have negative results.
“Changing regulations casually will result in real estate companies cutting back on New Stay apartment and this could result in a reduction in the supply of low cost apartments,” said Shim Gyo-eon, a Konkuk University professor of real estate studies.
The state-run LH is also looking into ways to refurbishing public housing that’s over 30 years old, as well as reconsidering the role of such apartments in redevelopment projects.
“We plan on supplying various low-cost apartments that meet the needs of different households such as young people or singles while improving services for residents,” said LH President Park. “In taking the opportunity of celebrating the 1 million units, we will be focusing more on improving quality.”
BY KIM KI-HWAN [email@example.com]