In Dongjak-gu, southern Seoul, a redevelopment cooperative is in talks with its construction company to exclude imported materials from interior finishes. With construction costs continuing to surge, the cooperative is exploring every opportunity to reduce expenses. It has set its target construction budget in the low to mid-7 million won range per 3.3 square meters.
“Construction costs have skyrocketed, so we’re focusing on selective investment,” the cooperative president said. “We’re considering allowing individual residents to choose their own interior finishes, while prioritizing higher-end specifications for exterior features and shared community spaces.”
The move reflects a shift in Seoul’s redevelopment sector, where high-end design had long been the standard. An increasing number of cooperatives are now turning to cost-saving measures, opting for domestic materials over imports and scaling back on specialized designs and complimentary features. These changes are also driven by a growing trend among homeowners to undertake major interior renovations soon after moving in.
As of Apr. 22, the average construction cost for redevelopment projects in Seoul has surpassed 8 million won ($5,630) per 3.3 square meters, according to industry sources. In response, some cooperatives are adopting more budget-conscious approaches. Basic materials are now sourced domestically, and fixtures such as kitchen shelves, interior doors, and bathroom components are offered in tiered options, allowing residents to choose based on price.
“In internal discussions, some joked that we might need to introduce a ‘minus option,’” said the head of a cooperative in Gwangjin-gu. “Our members are highly sensitive to additional contributions, so we’re doing everything we can to keep costs down.”
The shift toward cost reduction comes amid growing concern over rising construction prices. A study last year by the Korea Housing & Urban Research Institute analyzed 65 redevelopment projects nationwide with publicly disclosed cost data. In Seoul, the average came to 8.427 million won per 3.3 square meters—nearly a 60 percent increase from 5.287 million won in 2020.
“When members face difficulty paying additional contributions, we often see finishing materials downgraded or standard features reclassified as options, shifting the financial burden to individual members rather than the entire cooperative,” a representative from a major South Korean builder said.
Still, not all cooperatives are embracing austerity. In high-demand neighborhoods such as Gangnam, Yongsan, and Mapo, many are continuing to prioritize premium construction, even at higher costs to residents.
In 2024, the most expensive redevelopment project was in Mapo-gu’s Maporo-1 Zone 10, where construction costs reached 10.5 million won per 3.3 square meters. Yongsan-gu’s Namyeong Zone 2 followed closely at 10.48 million won.
Redevelopment in Banpo-dong, Seocho-gu—an area with active reconstruction—has also edged close to the 10 million won mark. The planned reconstruction of Samho Garden Complex 5 was projected at 9.9 million won per 3.3 square meters when bids were announced. Samsung C&T Corporation, Daewoo E&C, and POSCO E&C all submitted proposals, with Samsung C&T named the preferred bidder. Other projects, including Sinbanpo Complexes 2 and 4, each reported construction costs of 9.5 million won.
Cooperatives focused on controlling construction costs are also factoring in a broader renovation trend among new homeowners. Increasingly, residents are making large-scale investments in custom interiors—raising ceiling heights with tray ceilings, replacing kitchen countertops with imported marble, and installing full-wall stone finishes. This trend has contributed to the rise of so-called “showcase units” during pre-occupancy inspections.
According to the interior design industry, renovation costs per 3.3 square meters have tripled since before the COVID-19 pandemic—from about 1 million won to as much as 3 million won when using luxury materials. For a standard 84-square-meter apartment, full renovations now exceed 100 million won.
