The notorious 'only recommend to enemies' case of local housing associations has many successful examples emerging in Dongjak-gu, Seoul. Unlike reconstruction and redevelopment, this type of project starts without securing land, meaning it often leads to prolonged projects or corruption within the associations.
As of the 7th, according to the Seoul city and Dongjak-gu, there are a total of 12 business sites where local housing associations have successfully begun construction. This includes 'Hillstate Sangdo Prestige' in Sangdo 1-dong, which broke ground in November 2007 and received usage approval in 2013, and 'Sadang 3-dong Local Housing Association (Hillstate Euljiro Central)' which started construction this January. Among these, nine successful cases are concentrated in Sangdo-dong, while there are two in Sadang-dong, one in Sindaebang-dong, and one in Daebang-dong. The most recently started project, 'Hillstate Euljiro Central,' is set to be sold within the year.
As per the standards of the Seoul city, there are currently 118 local housing associations reported to be in progress as of the end of last year. This figure is based on the number of business sites where recruitment reports, association establishment approvals, project plan approvals, and construction are underway. Dongjak-gu has the highest number at 24, followed by Yeongdeungpo-gu with 11, Mapo-gu with 10, and Eunpyeong-gu with 9.
Local housing associations are projects where residents without housing or small housing owners with a dedicated area of 85㎡ or less establish an association to build dwellings. Since land acquisition is led by the members, there is an advantage of being able to obtain homes at about 80% lower than general sales. As there are no project profits, the benefits for the members can increase.
However, it is a project with a high level of risk. Members must shoulder various risks that arise during the progress of the project. Usually, the executive board of the association leads the project, but it often becomes prolonged due to issues such as lack of land acquisition and disputes among members. Since the project begins without the entire process being confirmed, expenses arising from each stage can increase the contributions of the members. Corruption may occur within the associations and project agencies, and in the worst-case scenario, the project could be aborted. In short, it is a 'high-risk redevelopment project,' earning the notorious label 'only recommend to enemies.'
The reason there are many successful cases of local housing projects in Dongjak-gu is fundamentally due to the abundance of available sites. With many aging residential areas, it is common for members to voluntarily attempt projects by designating plots. Located centrally south of the Han River in Seoul and with good access to Gangnam, there are many large construction firms involved as well. The district's facilitation of permits and consultations is also one of the reasons.
An official from the Dongjak-gu Office noted, 'Local housing associations are primarily run by the association head and members, so there are no separate supports.' However, they also said, 'The district actively responds when associations request consultations and is diligently processing administrative procedures.'