On September 15, Jeju Province announced that it will supply 10,000 units of public housing for youths, newlyweds, and the elderly. According to Maeil Business Newspaper, the province is already home to 364 households, including public rental housing – also known as Happy Housing units – in four separate housing grounds in Jungang, Seogwipo City. Happy Housing is spreading throughout the Korean peninsula. Prior to Jeju Province’s announcement, on August 25, the Gwangju-Jeonnam Regional Headquarters of the Korea Land and Housing Corporation (LH) finalized an agreement to implement the Suncheon-Jogok Happy Housing Construction Project.

Korea is inside the real-estate bubble. Leverage investment of the greedy aggravates the situation for the homeless. Individuals, households, and the Korean government are all waiting for the bubble to burst. Professor Kim Ji-hyun (Hanyang Cyber University, Department of Real Estate) mentioned, “Korea’s national housing prices began to increase in 2012 and has been on a steep rise in Seoul and the metropolitan area since 2019.” Apartment lease prices have risen more than 100 million won in less than a year and villas, which refer to multi-family housings under five stories high in Korea, are no exception to this rising trend. In August, the average villa sales price reached the peak when it rose by 0.82 percent, setting a new record for this year. Amid the chaos, many are hoping for a governmental response to their distress signal. 

Subscription for Life — Housing Subscription System

The Happy Housing Project is a public rental housing program focused on providing affordable and convenient accommodation to youths, newlyweds, and college students. This program is based on the collaboration of LH and the Ministry of Land, Infrastructure and Transport (MOLIT). According to Geumgang Ilbo, the mainstream newspaper for Chungcheong Province, the purpose of Happy Housing is to “shift the supplier-centered residential welfare perspective to a consumer-centered one.” Such efforts contribute to reducing social costs, such as commuting time, and help create a new urban hub for localized culture, economy, and public activities. In brief, the Happy Housing Project strives to make individuals happy with their housing choices. Many Koreans are looking forward to the project and hoping it will act as the needle to burst the longstanding bubble.

The foundation of the Happy Housing Project lies in Korea’s housing subscription system. Originally introduced in 2007, the housing subscription system allocates apartments, both publicly and privately built, through the selection of residents based on certain criteria. Such merit is given to those who are first-time buyers, households with many family members, or individuals who have owned a subscription savings account for a long period of time. By effectively selecting people who genuinely need a house to live in, the housing subscription system enables the Korean government to regulate apartment supply and control land usage for agricultural and residential purposes. In sum, Korea’s housing scheme takes charge of managing households and governmental matters.

Starting this November, the Korean government has taken a new direction with its housing subscription plans. Firstly, it aims to add more candidates to the subscription list. Initially, one-person households and newlyweds without children were excluded from the merit selection criteria; they are now, however, included in the Korean government’s plans. Many more Koreans are being promised a future of comfort and stability. Furthermore, the Korean government has extended the subscription deadline of the youth preferential subscription account. This account was first introduced in 2018 and was originally set to expire this year. However, as one of the 87 special youth measures devised by the government, the deadline has been extended to 2023. These amendments were made in hopes to maintain financial stability in housing and urban funding. In brief, housing subscription plans are changing to meet the demands and needs of Korean youth.

New Future in Suncheon City

Recently, Suncheon City signed an agreement to undergo Happy Housing construction. This agreement symbolizes a fresh start for its target audience, the MZ generation, which refers to a group of people born from the mid-1980s to the early 2000s, including college students, newlyweds, and youths. They had often been “alienated by the low-income housing welfare policy,” as stated in Newsis; however, the future will be different. Professor Kim regards Suncheon City as the hub for “business and commercial functions in addition to widespread communication, culture, and welfare in the region.” Due to the enforcement agreement, LH Gwangju-Jeonnam Regional Headquarters has built and supplied 5,462 Happy Homes in 23 districts in Gwangju City and Jeonnam Province since 2016. As a result, a steady supply of available homes to the residential market has bolstered prospects for the Jeonnam Province.

Nevertheless, Suncheon City seems to have a bumpy future ahead of it. According to The JoongAng, the location of Suncheon City had been deemed prospective by real estate investors long before any sort of agreement had been made. It was a highly requested area for housing by its occupants. The area was also home to four universities and five industrial complexes, which made it a central point of multi-transaction. However, construction processes were postponed continuously due to difficulties in securing business arrangements. Under Suncheon City’s agreement to undergo Happy Housing construction, “LH will be in charge of establishing, designing, and licensing the Happy Housing operation,” while Suncheon City undertakes to compensate the entire project. Lee Jae-ro, head of LH’s Gwangju-Jeonnam Regional Headquarters, highlighted, “We expect Suncheon-Jogok Happy Housing to serve as a residential ladder for newcomers to Suncheon.” His determination reflects how effective Happy Housing will be in rejuvenating the economy and improving housing welfare.

In conclusion, Happy Housing is the needle to solve Korea’s real-estate bubble. Professor Kim claims that finding the tipping point is difficult. However, she states, “if housing supplies are carried out smoothly as planned by the government, prices may start to stabilize.” The Korean government is seeking ways to include more youth in its housing plans. Suncheon City’s Happy Housing agreement is an example showing how successful Happy Housing is in creating a future of comfort and stability for Korean youth. The only question that remains is how Korea should expand and amend its plans to produce more significant outcomes. When will Korea’s needle become sharp enough to burst the real-estate bubble?