Remarkable industrial development and economic growth of Korea during the past half-century have led to the continuous growth of cities and concentration of population in urban centers. Consequently, the urban housing problem has been the core policy ...
Remarkable industrial development and economic growth of Korea during the past half-century have led to the continuous growth of cities and concentration of population in urban centers. Consequently, the urban housing problem has been the core policy challenge of the government during the past decades. A major government policy to solve the housing problem has been the supply of a large number of houses through a large-scale housing land development and clearing of bad houses, and it has served as an effective means to solve chronic problem of insufficient houses.
However, a new problem emerges in which, as housing areas built in the past have got old, and they need to be repaired and cleared, proper measures are not taken. Such housing problems were derived from the harmful influences of housing improvement projects and long-term deterioration of the real estate market, which have caused a big change in laws and institutions related with housing improvement projects.
The Urban and Residential Environment Improvement Law revised in December 2011 adopted the possibility of canceling improvement project district, and new type alternative improvement project. Before the revision of the law in 2011, the Seoul city government adopted the small houses supply expansion policy by establishing public management system and improvement plans in 2010 seems to be a typical means of strengthening public service to solve housing problems in recent years.
This study suggests problems we can expect from policy cases for strengthening public service aspect of the housing improvement projects, and remedial methods for them. About the situation of the Soul government policies to strengthen public service aspects of the housing improvement projects, this study differentiated existing methods and alternative methods and analyzed each of the two groups of methods to find remedial methods for them. And, by selecting case districts per a specific type policy, and calculating and comparing proportion rates before and after the specific policy is applied, this study analyzed profitabilities of the projects and suggested the implications.
Through such analytical process, the research could recognize that, while active intervening policies of the public can have positive effects on housing problems corresponding to the purposes of changed legal system, it can have unintended negative effects depending on the situation where various housing improvement projects are implemented.
Typical negative effects we can predict are unplanned development of individual sites, disputes among residents caused by burdens of sunk costs, shrinkage of project promotion by decrease of business profitability and the burden of initial financing, etc. This study suggested ways to remedy such policy problems.
As remedial methods, this study suggested active adoption of public membership system; provision of rental residences for poor house owners; adjustment of agreement rates for dissolution of improvement districts; link to alternative project method when an improvement district is dissolved. This study also suggested expansion of project implementation by public players to enhance driving force of housing improvement projects.
The advantages of project implementation by the public players are reduction of financial costs due to their high credits; possibility of securing credibility; larger-scale and continuous management of housing environment by responsible implementation; the possiblity of securing infrastructure only with small fluidity by using state-owned and public-owned lands within housing improvement districts; the possibility of upgrading driving force of the project by using rental residences.
If those remedial ways can be realized by revision of related system, we can expect that it can be an effective solution to housing problems.