“Isn’t remodeling a maintenance project?”, remodeling complex angry at 1/10 measures

1/10 measures that exclude remodeling, anger over remodeling complex “overlooked 1 million people”
President Yoon made a promise to ‘improve remodeling’ during the presidential election, but when will he implement it?
Will only certain maintenance projects benefit from the goal of ‘housing stability’? Industry “lack of market understanding”

On the 10th, while the ‘Plan to expand housing supply and supplement the construction economy (1/10 measure) to stabilize the people’s housing’ was announced, which aims to ease regulations on housing maintenance projects, there is a lack of improvement plans for remodeling projects compared to redevelopment and reconstruction. Criticism is being raised that On the 11th, the Seoul Remodeling Housing Association Council (hereinafter referred to as the Remodeling Council) pointed out in a statement, “Although this measure is a housing policy, there is not a single word of content that remodeling complexes across the country can agree on.” 

“Keep your presidential promise”, remodeling complex upsets

During the 2022 presidential election, President Yoon Seok-yeol pledged to improve remodeling-related systems, such as enacting a remodeling promotion law, improving safety diagnosis and safety review procedures, and reorganizing vertical and horizontal expansion standards for remodeling. According to the 2030 Seoul Apartment Remodeling Basic Plan announced by the Seoul Metropolitan Government last year, among the 4,217 apartment complexes in Seoul, the number of ‘complexes subject to remodeling’ that cannot be reconstructed amounts to 3,096 (898 for increasing number of households, 2,198 for customization). This means that there were many complexes that had high hopes for President Yoon’s pledge.

However, the January 10 measures announced by the government actually focus on redevelopment and reconstruction, including △ easing safety diagnosis regulations for reconstruction, △ easing redevelopment promotion requirements, and △ public support for the first phase of new town reconstruction. There were no improvement plans related to remodeling. The Remodeling Council, which was dissatisfied with this, said, “This housing policy should have included measures to improve and revitalize the remodeling system for housing supply in accordance with President Yoon’s presidential election pledge, but policies that are different from the presidential election pledge are being introduced, such as only easing regulations on reconstruction and redevelopment.” “He pointed out.

The Remodeling Council points out that in the case of complexes with high floor area ratios in Seoul, reconstruction is virtually impossible even if the complexes are tilted upward. In fact, the majority of complexes that choose remodeling are giving up on reconstruction due to the high floor area ratio rather than safety diagnosis issues. The Remodeling Council said, “There are about 140 remodeling complexes nationwide and about 120 promotion committees. “The Yoon administration is overlooking the fact that 400,000 households and over 1 million people are pursuing apartment remodeling to improve their living environment,” he said.

Although the form may be different, the purpose is ‘improvement of residential environment’

What is the essential difference between redevelopment/reconstruction and remodeling? The redevelopment project is a project carried out to improve the residential and urban environment in areas where maintenance infrastructure (roads, water and sewerage, parks, public parking lots, etc.) is poor and old and defective buildings (houses, commercial facilities, etc.) are dense. The reconstruction project is a project carried out in areas with good infrastructure but a high concentration of old and defective buildings, and focuses on improving the residential environment by demolishing problem buildings and constructing new homes.

Remodeling is a term that refers to repair and expansion projects to suppress the deterioration of buildings and improve their functionality. Unlike reconstruction, this is a form of ‘fixing’ the building rather than tearing it down. Remodeling projects can proceed more quickly than redevelopment and reconstruction, but have the disadvantage of lower member profits compared to reconstruction, which involves a large number of additional sales. Recently, some complexes have adopted methods of increasing new sales by expanding buildings horizontally or expanding separate buildings to solve these limitations.

What is clear is that redevelopment, reconstruction, and remodeling projects are part of the maintenance project that has the effect of improving the residential environment and expanding supply. To that extent, there is even analysis in the industry that the fact that the 1/10 measure does not include remodeling improvement measures is in fact a policy failure. It is pointed out that the government’s exclusion of certain maintenance projects when announcing housing stability measures is ultimately a problem of the government’s ‘lack of understanding of the market.’