Public criticism is mounting over the government's plan to build public housing on part of the Yongsan Park site as a way to ease Seoul's housing shortage. Ma Kang-rae, a professor of urban planning and real estate at Chung-Ang University and a former president of the Korean Regional Science Association, said in an interview with the Seoul Economic Daily on the 7th that "Yongsan Park is land that most Seoul residents have not set foot on for more than 100 years." He added that it "should be kept as a last resort to be considered only when every other option has been tried and nothing works." His point is that rather than using the Yongsan Park site for housing supply now, it would be better to preserve it as a valuable space, like Hyde Park in London or Central Park in New York. Ma, an urban planning expert, recently posted a sharp rebuke on social media, writing that "the ship is heading for the mountains, everyone is gasping, and it keeps going straight ahead." He said the fundamental reason Seoul home prices cannot be brought under control is that demand keeps concentrating in the capital region, and he proposed a "regional win-win housing pension" to support the relocation of baby boomers to the provinces, along with balanced regional development centered on a wide-area rail network.
— The government is considering housing supply on the Yongsan Park site.
△ The Yongsan Park site is land that most Seoul residents have not set foot on for more than 100 years, as Qing Chinese, Japanese and then U.S. troops were stationed there in succession after the Imo Incident of 1882. It compresses the sorrowful chapters of our history into one place. In that sense, it has been protected under a special law since the Roh Moo-hyun administration, and the idea of putting housing there because home prices are rising ignores that background. On top of that, it has an outstanding location at the very center of Seoul's three business cores — the Central Business District (CBD), the Yeouido Business District (YBD) and the Gangnam Business District (GBD). It is not that considering housing supply there is impossible, but it should be kept as the last card to be played when every other option has been exhausted. In particular, the former Defense Acquisition Program Administration site on the northern side of the park, which the government has classified as damaged land, sits in the middle of the green axis connecting Namsan and the Han River, and it is land that must not be touched. Once you touch it, other green areas will be touched just as easily, as happened with the greenbelt.
— Then are there alternatives for expanding housing supply?
△ The priority is to speed up the third-phase new towns and downtown redevelopment projects that have already been announced but are not progressing well. For the Yongsan rail yard site, where an international business district is being developed, the risk of an oversupply of offices also has to be considered. In the CBD alone — Seoul Station, Gwanghwamun and Euljiro — at least 1.65 million to 1.98 million square meters of new office space will be supplied over the next five to six years, or 3.89 million square meters by the estimate of the real estate consultancy CBRE. If that is the case, the Yongsan rail yard could reduce the share of offices and plan for more housing. Beyond that, a little more housing can be supplied by speeding up redevelopment projects in Namyeong-dong, Dongja-dong and Cheongpa-dong around Yongsan Park and by raising floor area ratios near subway stations.
— What is your view on transferring authority over developments of 500 units or fewer to the district offices?
△ Seoul is a dense space where it takes less than five minutes to go from Gwanak-gu to Dongjak-gu. Gyeonggi Province can do things differently because each city and county is large, but Seoul is a single city. Even if Seoul and Gyeonggi Province joined forces to draw up housing plans it would not be enough, and if this is broken up further, district offices will end up keeping development small, and schools, roads and public pedestrian paths will all be hard to design properly.
— Is there a way to solve rising home prices in Seoul?
△ Concentration in the capital region, rather than a supply shortage, is the fundamental cause. You should not think that building another 100,000 to 200,000 homes in Seoul can rein in prices. The problem is not that supply falls short of demand but the structure itself, in which demand keeps concentrating in the capital region. When a net inflow of 40,000 to 50,000 people accumulates every year, no matter how much you supply, it is like a thirsty person drinking seawater and feeling even thirstier. Building new homes actually makes a place better and pulls in more demand. In the provinces, by contrast, homes are emptying out for lack of demand. Actively looking for sites for supply is desirable, but in the end the answer is dispersing demand, and that is precisely balanced development policy. Balanced development policy must be treated not as simple support for the provinces but as a powerful and fundamental real estate policy.
— Why did you propose the regional win-win housing pension?
△ There are about 8 million first- and second-wave baby boomers in the capital region, and a considerable number of them have ties to the provinces. The problem is that a large share of their assets is tied up in capital-region housing, which makes moving difficult. So I proposed a regional win-win housing pension, under which they would move to the provinces while receiving both a housing pension and rental income without selling their homes, and their vacant capital-region homes would be supplied as long-term rentals to young adults and newlyweds. The current housing pension already recognizes exceptions to the actual-residence requirement for hospitalization or nursing care, extended stays to be cared for by children, and moves into senior housing welfare facilities, and the idea is to add relocation to the provinces to that list. A simple calculation assuming 1.8 people per household and a 70% homeownership rate shows that if just 10% of them moved, there would be the potential for about 330,000 capital-region homes to come onto the rental market. If some of the pension and rental income is channeled into local spending, it could help revitalize regional economies.
— Is there a need to ease regulations on rebuilding and redevelopment in Seoul?
△ Yes. But problems arise if this is approached simply as a means of expanding supply volume. Raising the floor area ratio of individual districts alone also increases demand for infrastructure such as schools, roads and parks, so you have to look first at the carrying capacity of the whole neighborhood rather than the profitability of individual projects. The Seoul city government should strengthen its role in drawing the big picture at the neighborhood level and bundling multiple redevelopment districts to adjust infrastructure. Areas near subway stations can be developed at high density while using part of the development gains to expand public rental housing and infrastructure. Because redevelopment projects take a long time until move-in, they have to run in parallel with rental housing supply policy.
— There is considerable concern that regulations on multiple-home owners will lock up the supply of jeonse and monthly-rent units.
△ The private sector supplies about 80% of our country's rental market. With the public sector unable to adequately replace it, excessive regulation of multiple-home owners could shrink private rental supply, and that burden could fall more heavily on renter households, which already face high housing costs. Even if multiple-home owners are regulated for the sake of fairness in capital gains, excessively tightening actual-residence requirements could increase pressure for existing rental homes to leave the market. In particular, for non-apartment housing such as low-rise multi-unit buildings, weakening jeonse demand after the jeonse fraud cases combined with worsening access to business financing has pushed construction starts over the past three years down to 20% to 30% of the long-term average.
— How do you assess the government's national balanced growth strategy centered on "five poles, three special zones"?
△ I assess it positively in that it has begun to set the spatial unit for balanced development properly. The capital region is already a single living sphere tied together by wide-area transport networks, while areas outside it have continued to compete at the city and county level. Competing with the capital region requires at least a mega-regional scale. The key is to create large hubs, mid-level hubs and rural hubs and connect them with transport and service networks. A legal amendment in May of this year also put institutional foundations in place, including balanced growth impact assessments and a special mega-regional account. But administrative consolidation itself must not become the goal, and each region must first clearly decide what it will make its living from.
— Why have past administrations' balanced regional development policies failed to deliver results?
△ The method of distributing budgets evenly, with many local governments each taking a small share, failed to create economies of scale beyond a critical threshold. Another problem was that policies were designed and divided along administrative boundaries even though those boundaries differ from actual economic living spheres. On top of that, development methods from an era of population growth were repeated in an era of population decline, so innovation cities on the outskirts of downtowns actually weakened the old city centers. There was a focus only on relocating facilities, with little attention to building networks of relationships. Going forward, the evaluation system must shift from the volume of budget spending to performance indicators such as the youth settlement rate and productivity, and the "five poles, three special zones" plan must be made a national spatial strategy lasting at least 10 to 20 years.
— You have named a wide-area rail network as the key infrastructure for the success of the plan.
△ Railways have the power to compress space. Travel times between major cities fell sharply after the introduction of the KTX, and Seoul to Busan was cut from more than four hours to just over two. Rail networks should be designed in this order: industrial ecosystem, then urban hub system, then the rail network. You must not draw the railway first and fill in the surroundings afterward. For KTX stations, too, the practice of building a station in an empty field midway between two cities to avoid conflict between local governments should be avoided. Rather than parceling out routes on a share-the-spoils basis, the principle of connecting hubs for jobs, universities, housing and health care within 30 to 60 minutes should be established first.
— You have emphasized developing railways and station areas together, the so-called "rail plus property (R+P)" approach.
△ In Japan, private railways have developed rail lines and station areas together. They concentrate residential, commercial, business and cultural functions around stations to create places where people gather, and that in turn raises rail demand and the value of the area. In our country, by contrast, the actors and decision-making for rail construction and operation and for urban development around stations are relatively fragmented. There is a station-area law and the Korea National Railway can also carry out development projects, but the system for bundling railways and urban development into a single long-term business model is still not sufficient. Looking at cases like Osaka Station or London's King's Cross, where a rail station and its surrounding area were developed together into a place people go out of their way to visit, a rail station should now be not a mere transit hub but a destination in the city in its own right.
— What needs to happen for genuine decentralization?
△ We first have to consider which regional unit to give authority to. If a basic local government of 20,000 to 30,000 people and a metropolitan local government of several million are given the same powers, gaps between regions will actually widen. That is why what is needed is "wide-area decentralization." Functions that require scale, such as industrial policy, wide-area transport, universities and research and development (R&D), should be handled by mega-regions, while welfare and daily-life services should be handled by basic local governments. The central government should focus on building trunk transport networks, fiscal adjustment, guaranteeing minimum service levels, and correcting the tilted playing field between the capital region and the rest of the country.
— What are the conditions for the success of megaprojects, and what should be prioritized?
△ The order should be power and water, then wide-area transport, then talent and the living environment. If even one of these is missing, a project is hard to start and hard to sustain. Semiconductor plants and artificial intelligence (AI) data centers cannot operate at all without power and water, so when sites are designated, transmission network and water supply schedules must be included in the project timeline. Wide-area transport plays the role of widening the labor market by bringing the talent pool of nearby large cities within a 30- to 40-minute commuting range. In the long run, it is people who decide the outcome. This is an era in which companies move to where good talent is. You cannot hold on to talent by simply building apartments next to an industrial complex. You have to build cities that have universities, research institutes, and commercial and cultural facilities together.
— How do you view the relocation of public institutions to the provinces and its effect on balanced development?
△ The first round of public institution relocation contributed to population and tax revenue growth, but it was not deeply connected to regional industrial ecosystems, so the ripple effects fell short of expectations. In the second round, public institutions should be placed together with related private companies, universities and research institutes. Balanced development and responses to regional extinction require a dual strategy for young adults and for the middle-aged. Young adults need jobs in the large cities of mega-regions, while the middle-aged need new settlement paths, such as a "return to work" route linking baby boomers with small and mid-sized provincial cities and companies. We need to recognize that balanced development is not welfare that helps the provinces but a national survival strategy that reduces the costs borne together by the capital region and the provinces.
◇ He is…
Born in Chuncheon, Gangwon Province, in 1971, he graduated from Seongsu High School and the Department of Applied Statistics at Chung-Ang University. He then earned a master's degree in urban and regional planning from the Graduate School of Environmental Studies at Seoul National University and a doctorate in urban planning from University College London (UCL). Since 2007 he has been a professor in the Department of Urban Planning and Real Estate at Chung-Ang University, and he has served as a member of the Presidential Committee for Decentralization and Balanced Development, a member of the Ministry of Land, Infrastructure and Transport's Capital Region Readjustment Committee, and a member of the Seoul Metropolitan Government's Urban Planning Committee, as well as president of the Korean Regional Science Association. He has long researched population change in cities and regions, regional extinction and balanced development. His books include "The Death List of Provincial Cities," "Decentralization Ruins the Provinces" and "Everyone Survives Only When the Baby Boomers Leave."
