Rental Apartments Utilized as Permanent Rental Housing

The Korean government has announced its plans to utilize rental apartments constructed through the system to Renew Development Profits from Reconstruction, as permanent rental apartments for the middle class.

In addition, should housing units that had received reconstruction permits before September 5 2003 be named “one to one” reconstruction, the units would be excluded from the development law.

Han Chang-sub, section chief of housing and environment of the Ministry of Construction and Transportation, stated on February 23, “The rental apartments constructed through the system to Renew Development Profits from Reconstruction will be excluded from the transfer of property rights, effectively sealing ownership from the public.”

To do this, local governments should purchase the rental apartments constructed through the reconstruction projects. Failure to do so would result in the Ministry purchasing the apartments through the Korea National Housing Corporation.

Those currently without housing and who are living in the area are prioritized in being granted the rental apartments, some of whom will be selected by the mayors or other local leaders in the district.

The ministry will also apply the system to Renew Development Profits from Reconstruction regardless of the number of households in the apartments, so that even small apartment units under 300 households should construct rental housing if the reconstruction generates an increase in the ratio between land and buildings.

However, units that have received permits for “one to one” reconstruction before September 5, 2003, when the policy for mandatory small-unit housing was first installed, are exempt from the development law.

Following this plan, a total of 1,482 households in three apartment units, including Yongdong Unit One (1,050 households), located in Gangnam-gu, Seoul; Gaenari Unit Two High-rise (288 households); and Jindallae (144 households) of Daechi-dong, may conduct reconstruction without building rental housing.

The Ministry of Construction and Transportation estimated that the new bill could provide an additional 40,000 rental apartments in the Seoul metropolitan area.

Jae-Seong Hwang jsonhng@donga.com