[Seoul's News] Seoul’s SIA Social Houses Emerge as Houses for Young Koreans
Seoul’s SIA Social Houses Emerge as Houses for Young Koreans
- The SIA Social Housing Project was adopted as a government policy and the original goal of 15,000 houses will be achieved within the year.
- The SMG has been making preparations for the project in a total of 45 sites (16,851 houses) and broke ground at three sites (3,616 houses) including Hangangno 2-ga.
- The preexisting support policy for deposits and monthly rent will be applied to young people with low income next year for social mixing.
- The SMG eased the target range of the project and the requirements for designation by revising the Ordinance for Provision of SIA Social Houses and will propose institutional improvements to the central government.
- SH will handle the construction work and housing management for private businesses and its first agreement is already in progress.
- The Korean government is making efforts to secure 200,000 houses for in station influence areas and increase the capacity of college dormitories to 50,000 in order to reduce the burden of living on college students other young people.
Among the 45 project sites, three project sites (▴1,916 houses in Hangangno 2-ga, Yongsan-gu, ▴523 houses in Chungjeongno 3-ga, Seodaemun-gu, and ▴1,177 houses in Seogyo-dong, Mapo-gu) were approved in March and construction work has commenced. A total of 3,616 houses will be constructed.
※ Progress of the SIA Social Housing Project for Young People
|Category||Item||Approved||In progress||In preparation|
|No. of cases||45||3||14||28|
|No. of houses||Sum||16,851||3,616||5,471||7,764|
<The SMG will attract tenants from various income brackets for social mixing by expanding its preexisting deposit and rent support policy>
- Tenants whose monthly average income is below 70% of the urban household income of the previous year are entitled to the Long-term Housing Policy. Tenants can borrow 30% of the tenancy deposit, up to 45 million won, interest free. The targets are houses whose area of exclusive use space is 60㎡ or below. The sum of the deposit and monthly rent (tenancy deposit) should be below 220 million won or below for single-person households and 330 million won or below for two-person households.
- Tenants whose monthly average income is about 50% to 60% of the urban household income can receive interest-free loans for the deposits and monthly rent through the Housing Voucher Policy. The SMG will provide tenants whose monthly average income is below 50% of the urban household income with public rental houses (happy houses) at the prices of national rental housing.
As the tenancy deposits of SIA social houses are expected to be lower than the maximum aid for deposits (Area of exclusive use space: 60㎡ or below, 330 million won), all tenants of SIA social houses will be able to receive the benefits.
- As more and more people are expected to move into SIA social houses, the SMG will ask the central government to increase funding.
|Income criteria||Below 50% of urban household income||50% - 60% of urban household income||61% - 70% of urban household income||Over 70% of urban household income|
|Support measure||Supplying public rental houses at the prices of national rental housing||Providing an interest-free loan for deposit
(45 million won)
+ monthly rent
|Providing an interest-free loan for deposit
(45 million won)
|Providing the first rent at 60% of the market prices|
(for one person)
|200,000 won or below||200,000 won - 300,000 won||300,000 won - 400,000 won|
※ Five support measures for tenants of SIA social houses (came into effect January 2017)▴Minimum deposit ratio: 30% ▴Providing up to 45 million won, interest free, for deposits to young people with low income▴Providing small houses in areas with high rent such as Gangnam, and downtown areas. ▴Introducing sharing houses ▴Establishing community facilities for young people
<The SMG eases the range of the project targets and the requirements for designation by revising the Ordinance for Provision of SIA Social Houses>
※ The Ordinance for Provision of SIA Social Houses of Seoul Metropolitan City (May 18, 2017)
▴Among the public transportation-centered SIAs, easing the minimum road width standard from 30m to 25m ▴Including the neighboring commercial areas in the project targets ▴The Mayor may designate areas with a dense population of young people requiring houses as the project targets discretionally. ▴Not applying the standards for outdated structures to the preexisting facilities (not houses) with a total floor area of 5,000㎡ or below in the project areas, etc.
<SH handles the entire project and housing management for private businesses that have difficulty in conducting construction work and managing houses>
- SH concludes a lease agreement of private rental houses with private businesses for up to eight years. As a result, private businesses can easily raise business funds and SH can sublease the houses to young people. This system called self-management type rental housing management is now in force.
- Furthermore, the SMG concluded an agreement with Korea Housing Finance Corporation (HF) and KB Kookmin Bank on April 19 so that private businesses that entrust project/housing management to SH and have difficulty raising initial business funds can borrow up to 70% of the business expenses under the guarantee of HF. SH will make an investment in private businesses that conduct the project in the manner of REITs.
The SMG signed its first agreement for general project management with a private business (land owner) in Yongdap-dong, Seongdong-gu and has been working on the approval process. The SMG will expand this support project and support about 1,500 houses this year.
As the SIA Social Housing Project for 2030 became part of the government policy, the SMG will propose institutional improvements to the central government.
Its improvement proposal includes ▴the expansion of the scope of the review and the simplification process of the Deliberative Committee of Private Rental Houses, ▴the limitation of the annexed parking lot in the SIAs and the installation of the sharing parking lot (Car-Sharing Service), and ▴the national support of the deposits and rent for young people with low income .
If such improvements are properly achieved, the SMG expects that it can exceed its original goal of supplying 50,000 SIA social houses (10,000 public rental houses and 40,000 private rental houses) within three years.
- In addition to the revision of the Ordinance for Provision of SIA Social Houses and the support of Seoul Housing and Communities Corporation, the SMG will hold a weekly information session for land owners, experts, and citizens at City Hall. It will hold a visiting information session at the request of land owners, etc. so as to attract more interest and participation in SIA social houses.
The SMG conducts the SIA Social Housing Project for 2030 to reduce the burden of living on young people. The SMG upgrades the land usage of private land in the public transportation-centered SIAs, simplifies the relevant processes, and gives tax benefits to private businesses. In return, private businesses remodel all the residential space into public or private rental houses and provide them preferentially to young people.
- In return of upgrading the land usage, private businesses remodel 10% to 25% of their residential space into public rental houses and supply them to the SMG. The SMG provides these rental houses at 68% to 80% of the market prices of the surrounding areas.
- The remaining 75% to 90% is remodeled into private rental houses and provided at 90% of the market prices of the surrounding areas.
- Moreover a variety of community facilities for young people including business incubator centers, educational facilities, conference rooms, concert halls, and exhibition halls will be installed in SIA social houses. In addition to being a place to live, SIA social houses will be a place to work, enjoy, and play as the epicenter of the community for youth.
The Director of the SMG Housing & Architecture Bureau Jeong Yu-seung said, "We are glad that the SIA Social Housing Project for 2030 of the SMG was selected as a government policy. This project may solve the housing problems of young people in Korea including Seoul. We are willing to share our knowhow with the central government and other cities."