Abstract
Focusing on the case of urban development in Gangnam, this article explores how middle-class identity based on residence in apartment complexes was created in South Korea beginning in the late 1970s. I argue that state policy, speculation, and exclusion were key ingredients in the making of the middle class in Gangnam. Many white-collar families became apartment owners through a government-subsidised apartment lottery programme, and subsequently climbed the economic ladder more rapidly than others because of skyrocketing housing prices. Their rise to middle-class status, facilitated by chance and furthered by their willingness to engage in real estate speculation, was seen by many as illegitimate. In the face of scepticism about their status, Gangnam residents strived to cultivate cultured, modernised, and Westernised middle-class lifestyles so as to distinguish themselves from non-Gangnam residents and justify their economic success. This paper emphasises the dialectical process – both top-down and bottom-up – of middle class formation during the Gangnam boom. Based on a year of field research conducted in Korea, I analyse the lives and experiences of the middle class and their strategies for upward social mobility in the housing market.
In 2012, the song Gangnam Style made Korean pop star Psy a global sensation. The song parodies the lifestyle of a district in Seoul called Gangnam and mocks its superficial, materialistic culture. Since the late 1970s Gangnam has, within Korea, served as an icon of rapid urban development and affluent lifestyles. Having benefited greatly from rising real estate prices and planned urban projects, Gangnam has become one of the wealthiest and most expensive districts in Korea, and embodies prosperity, social status, and high culture. Koreans have conflicting views of Gangnam. On one hand, it is an aspirational space; 1 ordinary Koreans are envious of Gangnam residents, and dream of moving there. On the other hand, many share a sense of unfairness about what they view as the corrupt and unscrupulous ways in which Gangnam residents acquired wealth through real estate speculation.
How do urban development and restructuring shape social inequality and exclusion? How does urban space contribute to the making of a particular class subject? This article traces how Gangnam became the location where, in the 1970s, huge, expensive apartment complexes were born and popularised, and where the typical Korean middle-class neighbourhood as it is now understood was created. Yet a closer look at Gangnam reveals the uneven, contested history of Korean development. Conventional wisdom holds that the middle class emerged from rapid industrialisation and the expansion of education and job opportunities (Amsden, 1989; Koo, 1991). While the stable jobs and rapidly increasing wages that accompanied industrialisation significantly improved people’s livelihoods, this explanation ignores the important role of homeownership and residential locations in the formation of the middle class. I argue that the making of the middle class in Gangnam took place through speculation and exclusion. Many first-generation members of the middle class were able to accumulate wealth and acquire upward mobility simply by owning a home in Gangnam, where the real estate boom originated. Those lucky enough to win the lottery for new Gangnam apartments (often by manipulating the system) could profit from skyrocketing housing prices – leaving behind many others with similar qualifications who did not enjoy such an opportunity. Thus, the Gangnam middle class was largely considered to have benefited from ‘illegitimate’ unearned income. Yet Gangnam residents tried to legitimise their wealth by cultivating a modernised, Westernised milieu in their high-rise apartment complexes and distinguishing their ‘superior’ lifestyles from those of more traditional and ‘less enlightened’ non-Gangnam residents. In describing the making of speculative and exclusive Gangnam, I aim to demonstrate how Korean middle-class identity was created, and how new forms of social inequality were spatialised. In doing so, this article contributes to a critical understanding of the nexus between urban development, the housing and restate market, and class formation and identity in Korea.
This study draws from fieldwork I conducted during 2008–2009 and in the summers of 2013, 2014, and 2015. During these field trips, I collected archival data such as newspapers, government documents, oral histories, and popular magazines, and conducted in-depth interviews with 30 past and current Gangnam residents, most of whom lived there beginning in the 1970s and 1980s. Using snowball sampling, I recruited apartment owners/dwellers in Gangnam, including white-collar workers, professionals, schoolteachers, and housewives. I focus on a 20-year period (1976–1996) that saw the blossoming of a middle-class identity and consumer culture based on apartment complexes. 2 My analysis begins in 1976 because that was the year the government divided large portions of Gangnam into apartment construction districts (Han and Kang, 2016), spurring private developers to construct large complexes (the famous Hyundai Apartment Complex in the Apgujeong neighbourhood was completed in 1976). At the same time elite schools were encouraged to move to Gangnam, and the district started to become a popular residential destination among middle-class families.
In what follows, I build a theoretical framework for the analysis of middle-class formation and urban space. Next, I discuss how the state promoted Gangnam’s development and encouraged young, educated, white-collar families to move there by providing infrastructure, encouraging the construction of apartment complexes, and organising school districts. Then I analyse how ordinary citizens employed specific strategies to climb the housing ladder and acquire middle-class status. The final section demonstrates how, given the negative perceptions that have emerged of Gangnam as a seat of speculation and corruption, the district’s residents have tried to validate their status and wealth as ‘legitimate’ by cultivating a ‘civilised’, Westernised cultural milieu and forming a distinctive cultural identity.
The making of the middle class: Urban space, homeownership, and culture
Gangnam was the first site in Korea targeted by planned urban projects and developed into a middle-class residential district. 3 The processes through which Gangnam has become what is now as a symbol of middle-class status, ‘culture’ and ‘civilisation’, and social aspiration can be seen as a production of a distinctive space. By drawing from three sets of literature – on capital-led urbanisation, the developmental state, and social class and urban exclusion – I analyse how the middle class in Gangnam was created.
Many scholars have argued that urban development and restructuring were mainly spurred by capitalist logics of accumulation (Davis 2004; Harvey, 2005; Logan and Molotch, 1987; Sassen, 2001; Smith, 2002). Under the globalisation and neoliberalism rubric, cities both in developed and developing countries are subordinated to the mechanisms of economic values and corporate profits. As cities become targets of global finance, land use is intensified and urban landscapes are restructured, including the demolition of deteriorating low-income housing, the promotion of luxurious housing projects, 4 the construction of high-rise skyscrapers and cutting-edge buildings for global spectacle, and the development of new towns and suburban areas. Particularly in developing countries, mega urban projects are also intended to create the image of a world city to attract more global investment (Marshall, 2003). In this process, low-income and socially marginalised people are usually displaced to the outskirts of cities in favour of the more affluent. From this perspective, the pattern of Gangnam development – involving the real estate market channelling surplus capital from the domestic economic boom, an influx of income earned in foreign countries, and private housing development favouring affluent middle-class families – can be explained as urbanisation by capital accumulation. Yet this explanation tends to erase specific local contexts and the role of local actors.
The state plays a critical role in urban development: state policies and strategies shape various outcomes in built environments and spatial order. In the East Asian context, the role of the state has been decisive in transforming urban spaces, from the clearing of slums to the construction of new townships, expressways, and export zones (Shin and Kim, 2016). Recent studies have highlighted the role of the developmental state in dramatic urban changes: not only does the developmental state promote the rapid physical expansion of urban infrastructure, but it also cultivates urban developmentalism as the dominant ideology of state projects by showcasing well-planned built environments and new living facilities (Doucette and Park, 2018). Scholars have conceptualised urban developmentalism (or developmental urbanism) in East Asia, paying attention to the ways in which cities have become sites for materialising the planning ambitions of the developmental state (Doucette and Park, 2018; Shin, 2016). Gangnam’s uniquely rapid large-scale spatial transformation, from nearly worthless rural land to a valuable and desirable new district, can be conceptualised in this light. The top-down process of building urban infrastructure such as roads and transportation systems, massively increasing the area’s housing stock, and making Gangnam into a business hub was only possible under an authoritarian developmental state that was willing to pursue efficiency and growth while producing social exclusion and inequality (Ji, 2016). It was also politically important for the authoritarian state to showcase successful urban development, particularly in the context of the Cold War and the confrontation with North Korea. Thus, concepts such as the developmental state and developmental urbanism are helpful in contextualising the Gangnam case.
In analysing how middle-class identity was created and articulated based on apartment complexes in Gangnam, however, the political-economic approach emphasising either capital or the state does not fully account for discursive and cultural practices and subjective experiences in particular spaces. The built environment and geographical location shape the space, but at the same time residents fashion particular lifestyles, imbue their surroundings with meaning, and engage in everyday practices, all of which contribute to spatial differentiation. Recent scholarship on middle-class communities and spatial exclusion in Asia examines how members of the urban middle class produce class boundaries and new forms of spatial inequality within their neighbourhoods (Fernandes, 2006; Pow, 2007; Tomba, 2004; Zhang, 2010). In addition to objective and economic components of social class – income, wealth, and occupation – these studies highlight class formation through everyday practices and spatial distinction. Scholars have also emphasised middle-class discourse on urban order and civility, which often serves to create privileged spaces by excluding ‘unruly or uncivil’ citizens (Harms, 2016). By enacting their own imaginaries of what their neighbourhood should ideally be and normalising middle-class values, residents cultivate class identities linked to their living space (Elwood et al., 2015). I highlight the discursive practices and symbolic boundary-making of Gangnam residents in relation to others as an essential part of the making of the middle class.
Emerging Korean scholarship on Gangnam has contributed to an understanding of the relationship between urban space, development, and social inequality (e.g. Han and Kang, 2016; Kang, 2006; Lim and Kim, 2015; Park, 2013; Park and Hwang, 2017). While existing studies enhance an understanding of Gangnam development from an urban planning perspective, they fail to explain adequately how a particular form of middle-class identity and culture was cultivated and articulated in apartment complexes in Gangnam. Linking space to the class formation process, I examine how middle-class identity and subjectivity were inscribed in Gangnam. I view Gangnam as the result of a dynamic and long-term negotiation between the state project of modernisation, the market (real estate developers), and the people who came to live there. By documenting how the state promoted massive housing projects in Gangnam and how individuals in turn adopted particular economic and cultural strategies, I try to bridge the gap between economic and cultural conceptions of class, between top-down and bottom-up processes, and between macro and micro levels.
Gangnam as representative middle-class space
Gangnam literally indicates the area south of the Han River (‘gang’ is river, ‘nam’ is south), as opposed to Gangbuk (north of the Han River). While Gangnam can be defined in different ways – from the narrowest, limited to just the administrative district of Gangnam-gu itself, to the broadest, which would encompass the whole area south of the Han River – I follow the conventional and common definition of Gangnam as an area composed of the three administrative units of Gangnam-gu, Seocho-gu, and Songpa-gu 5 (Han and Kang, 2016; Kang, 2006). These three districts (see Figure 1) display what are commonly understood to be Gangnam’s typical characteristics as a space for affluent, highly educated residents.
The Gangnam District in Seoul.
Gangnam has come to symbolise wealth, social status, and prestige; it is the centre of finance, education, fashion, and information technology, and provides access to good school districts and convenient living environments. Gangnam’s status as the most desirable residential location in Seoul has maintained its high housing prices and attracted many affluent middle-class families. Gangnam-gu has a budget three times larger than the average of other administrative units in Seoul and a well-maintained infrastructure. Gangnam has the highest apartment price per p’yŏng 6 – twice the average of Seoul, and four times as much as some areas (Kang, 2004: 65). The mass media produce hegemonic images of Gangnam as a space of the rich, symbolised by upscale apartments and conspicuous consumption. These images create a widespread aspiration to live in Gangnam, and endow Gangnam’s residents with symbolic power (Bourdieu, 1989).
It is true that some pockets of Gangnam contain wealthy residents, and that Gangnam’s skyrocketing housing prices over the last few decades have made it increasingly unaffordable. For this reason, the media have portrayed Gangnam as solely an elite space. Yet this generalisation is difficult to support. Gangnam’s residents mainly consist of educated professionals and white-collar employees who are primarily identified as members of the middle class (Wright, 1985). As of 2013, more than half of residents in Gangnam-gu are professionals (34.6%), white-collar workers (22.4%), and managers (8.6%), which makes Gangnam more middle-class than the Seoul average (professionals 25.3%, white-collar employees 20.2%, managers 4.2%). Of Gangnam residents, 32% are college-educated (Gangnam-gu, 2014: 61). Gangnam’s working-classresidents amount to less than 10% of the population, and its percentage of low-income households (8.2%) is much lower than the Seoul average (17.6%). 7 A roughly similar breakdown has predominated through the decades. Gangnam’s new residents in the late 1970s were mainly white-collar families, relatively well educated and earning stable salaries at big corporations and banks and in the public sector. In sum, Gangnam’s demographic composition indicates that the bulk of its residents are, and have been since the 1970s, solidly middle class.
Before Gangnam, Seoul’s urban spaces were more mixed and not spatially differentiated by class. As new apartment complexes were built on a large scale in Gangnam, rural, low-income residents were displaced, and white-collar families with stable jobs and incomes moved in. By spatialising groups in this way, Gangnam became an increasingly distinctive middle-class space. Thus, the rise of Gangnam exemplifies how residents with similar socioeconomic conditions cultivated an identity, how the idea of the middle class materialised in urban spaces, and thus how these urban spaces became stratified in Korea.
A mega state project: The making of Gangnam
In the 1970s, Seoul’s population increased rapidly. As state-driven industrialisation accelerated, more and more people left their rural hometowns and migrated to big cities, particularly Seoul, for jobs. The explosive growth created transportation and environmental problems, as well as a housing shortage. The Park Chung Hee regime (1961–1979) started looking into developing Gangnam and relocating population there. Prior to this, Gangnam was sparsely populated countryside. In 1963 only 14,867 people lived in what is now Gangnam-gu, and just 12,069 in what is now Seocho-gu (currently, Gangnam-gu’s population is 560,000, and Seocho-gu’s 430,000). 8 Gangnam was not connected to the city’s centre, and lacked basic infrastructure such as public transportation, roads, and housing.
By providing incentives, deregulating the real estate market, and building basic social infrastructure, the government promoted Gangnam’s development, while at the same time curbing new urban projects in Gangbuk (Son, 2005: 229). The city set out to make Gangnam a new hub of transportation and administration. All the major transportation facilities, including bus terminals, were moved from Gangbuk to Gangnam. Starting in 1969, the government constructed a number of bridges connecting Gangnam and Gangbuk, and extended second and third subway lines into Gangnam (Kang, 2006; Son, 2005). Major government and business offices were also relocated to Gangnam (Seoul Metropolitan Office, 2012: 23).
More importantly, Gangnam’s development went hand in hand with apartment construction. Given Korea’s small size and high population density, policy makers regarded high-rise apartment buildings as the most viable way to provide more housing (Korean Housing Corporation (KHC), 1992: 493). Of housing constructed in the 1970s, 70% consisted of apartment complexes accommodating more than 2000 households (Gelézeau, 2007: 91). Between 1975 and 1985, a total of 60,000 apartment units were constructed in Gangnam, about 60% of all apartments built in Seoul during that decade (Seoul Museum of History, 2011: 42). As of 1985, the percentage of apartments among all domiciles was only 26.5% in Seoul, but it was 72.7% in Gangnam.
In the early 1970s, the publicly owned Korean Housing Corporation (KHC, Taehan Chut’aek Kongsa) undertook a number of colossal apartment construction projects in Gangnam. Seoul’s first large-scale middle-class apartment complex was built in Gangnam’s Banpo neighbourhood between 1971 and 1974 (KHC, 1992: 380). Unlike previous smaller-scale apartment complexes, the Banpo complex accommodated up to 4000 households and 15,000 people (KHC, 1992: 380). Another gigantic apartment complex hosting 20,000 households and 100,000 residents was built in Jamsil on the east side of Gangnam between 1975 and 1977 (KHC, 1992: 130–131). The units in such large complexes ranged from 22 to 44 p’yŏng (782.76–1565.52 ft2) in area, and were marketed to relatively affluent families. Intended to be self-sufficient communities, the complexes were equipped with schools, shopping centres, grocery stores, gyms, and playgrounds, and featured plenty of green space (Son, 2005). This model set the pattern for apartment construction from then on, and apartment complexes set the pattern for a new way of middle-class living.
Though the KHC built extensively in Gangnam, private developers – particularly chaebol (large, family-owned conglomerates) – played a more central role in apartment construction. The Korean government prioritised investment in heavy industry, but lacked the resources to directly provide affordable housing for the majority of the population. It therefore mobilised private developers, requiring them to charge affordable prices for apartments (Son, 2008: 77). The government provided many incentives to chaebol to attract them to the apartment construction business, making cheap land available and granting tax exemptions (Lim and Kim, 2015: 158). Private developers also benefited greatly from the apartment lottery system (ap’at’ŭ punyang chedo) launched in 1977. Under this system, developers could sell apartment units even before they were completed. Anyone wanting to buy a new apartment had to open an account and deposit money with the Housing Bank, the exclusive manager of the lottery system. When someone drew a lot that gave them the right to purchase an apartment, they had to pay in full before they moved into their unit. As construction companies received deposits and lump sum installments from applicants even before they completed projects, and could wait to pay subcontractors for construction materials until they were just 45 days away from completion, they were able to earn enormous amounts of interest, especially during that time of double-digit interest rates (Hyun, 1978: 140). In addition, the profit rates of construction companies were high. Selling prices were usually twice the construction costs, and the return rate could amount to almost 40% (Hyun, 1978: 142–144). Because of these financial advantages, the apartment business was extremely lucrative for construction companies, and a number of firms grew rapidly through housing construction. Taking advantage of government support and high demand, construction companies in the 1970s and 1980s focused on building large, luxurious apartment buildings rather than providing affordable housing – and made enormous profits.
The massive construction boom in Gangnam dramatically changed perceptions of both apartment living and Gangnam. When they were first introduced in the early 1960s, apartments were viewed as housing for low-income families. The Wau Apartment incident in 1970 – when a poorly constructed building collapsed three months after completion, resulting in the deaths of 33 residents (newspaper article in Maeil Kyungje, 4 September 1970) – strengthened the negative image of apartments. However, apartment construction projects in the 1970s focused increasingly on larger, higher-quality apartments, and advertised modern, Westernised lifestyles for educated, salaried middle-class families. Apartments quickly came to represent a new age of middle-class living, and Gangnam symbolised modern apartment complexes.
Education was another factor that made Gangnam attractive to middle-class families. Currently, Gangnam’s schools are considered more academically oriented, its students more competitive, and its parents better informed than anywhere else in Seoul, and many good ‘cram schools’ are located there. 9 Gangnam’s educational reputation is a direct outcome of the government policy that relocated elite schools to Gangnam in the late 1970s, and has kept real estate prices high.
The major channel for class mobility in Korea had always been education. Graduation from a prestigious university guaranteed social status and economic success for a lifetime. Sending their children to the best schools was an important family project for most Korean parents, and early preparation for college entrance exams was seen as critical. State officials and urban planners thought, correctly, that moving elite schools to Gangnam and establishing a good school district there would make the area appeal to the many parents who were willing to sacrifice for their children’s success (Seoul Metropolitan Office, 2012).
In the mid-1970s, most of the top schools were located in Gangbuk. As part of the Gangnam development programme, the government offered many incentives to convince elite schools to move to Gangnam. For example, it not only subsidised construction, but also helped to provide lower prices and larger sites for schools to build on. Additionally, the government offered the schools tax exemptions, and promised it would build paved roads and an appropriate sewage system (Seoul Metropolitan Office, 2012: 27).
After Kyunggi High School, the most prestigious school in Seoul, moved to Gangnam in 1976, other elite schools, such as Huimun High School, Sukmyung Girls’ Middle and High Schools, and Seoul High School, also moved there, all from 1978 to 1980 (Kang, 2006: 94). Between 1976 and 1990, 11 elite high schools left their original sites and settled in Gangnam (Seoul Metropolitan Office, 2012: 29). Some second-tier schools moved to Gangnam in the hope that relocation would in itself strengthen their reputations. By the mid-1980s, Gangnam’s School District Eight (p’al hakkun) had become known as a district of ‘rising’ elite schools (sinhŭng myŏngmun’gyo) with a reputation as a shortcut to the elite universities. Between 1984 and 1986, the five high schools with the most students admitted to the top three universities in Korea (Seoul National, Yonsei, and Korea) were all located in District Eight (Jung, 1988: 548–549).
Gangnam’s new reputation as an educational mecca made parents all the more determined that their children go to school there, causing an even greater influx of new residents. As of 1985, about 30% of Seoul’s total population had moved within the last five years, but the figure was 89% in Gangnam. In the mid-1980s, the number of high school students in Seoul increased by 1.2%, but by 57.5% in Gangnam (Kim, 2004: 19), strongly suggesting that families were moving to Gangnam for educational purposes. Indeed, most of my informants who live (or had lived) in Gangnam told me that the biggest reason they moved there in the 1980s was for their children’s education. They believed that Gangnam’s schools would expose their children to a more academically competitive environment and better prepare them for college entrance exams. Gangnam’s popularity grew so much that many of its schools struggled to accommodate the influx of students – and the demand for apartments continued to increase.
In sum, the development of Gangnam was a large state project that transformed the area, once seemingly worthless and far from the heart of Seoul, into a modern urban cityscape within a single decade. Yet it is noteworthy that Gangnam development was rigged by corruption and speculation. Chaebol offered politicians and government officials bribes in exchange for information on development projects, and then bought potentially valuable lands in Gangnam. A former urban planner, Jung-Mok Son, recalls that the government’s lax regulation of the real estate market was rewarded when portions of the profits from corporate real estate investment were funnelled to their political campaigns (Son, 2003: 130). The massive construction boom and continued economic growth stimulated the real estate market and caused real estate prices in Gangnam to rise a thousandfold between 1963 and 1979 (Son, 2005: 236). The real estate boom in Gangnam in turn fuelled more investment, thereby further increasing real estate prices and rendering Gangnam synonymous with greed and high-rolling speculation.
Becoming an apartment owner in Gangnam: Real estate investment and class mobility
As Gangnam was transformed into a modern residential area with good schools, a convenient living environment, and swiftly rising property values, many families aspired to move there. The government-sponsored apartment lottery system provided an important channel through which ordinary salaried families became homeowners and improved their living standards. Since the government controlled apartment prices in the lottery, winners were able to purchase apartments at prices much lower than market rates.
Yet the available ways of becoming an apartment owner in Gangnam relied on exclusion, and encouraged speculation. The target constituency for apartments, even smaller units, had incomes above the average (Gelézeau, 2007: 97). Since the lottery programme required winners to pay several installments and other fees before moving in, only those with stable incomes, who could afford to make the down payment, were able to benefit from the new system. These were mainly professionals and white-collar workers. Low-income families were, in practice, excluded by the programme.
Because of appreciating property values, Gangnam’s lotteries attracted a huge number of applicants – not only those seeking a home to live, but also speculators trying to purchase additional homes to make money. The chance of drawing successfully in the Gangnam lotteries was low; some reached odds as high as 100 to 1 (Chang, 1978: 108). It was common to borrow the names of friends or relatives in order to enter multiple times. The lottery became an opportunity to make money. For example, lottery winners acquired occupancy rights (ipchugwŏn) that made them eligible to move into the apartment unit. In the absence of strict regulations, these winners could sell their winning tickets (ttakchi) for a high ‘premium’ instead of moving in. Buyers paid very high premiums, often between 2.2 million and 17 million won per apartment unit (Chung, 1978: 129). With average monthly income for urban households at only 144,510 won in 1978 (Korean National Statistics Office, 1998), such ‘gambling’ could be very lucrative. Before anyone actually occupied an apartment unit, the tickets might have changed hands several times – in some extreme cases, as many as 30 or 40 times.
Since apartment properties brought in a far greater amount of money than regular salaries, it was a rational decision for those interested in earning extra money to invest in real estate. Speculative activities were widespread among housewives with an entrepreneurial bent. Ms Chang, a housewife (born in 1949) married to an engineer for a major firm, lived in Gangnam until the mid-1990s. She recalled how ordinary housewives, including herself, commonly benefited from real estate investment: Speculation was not unusual at all. It was very rare to find people who did not speculate in real estate. It was common to buy and sell apartments for this purpose. While my husband earned relatively good money, we could become better off with real estate investment. But [what we did] was nothing compared with others who got much richer. At that time, there was no heavy tax burden. By doing this a few times, I could earn a fair amount of money. Six months after I bought for 8 million, I could sell at 16 million. It was double! I made the same amount of money as my husband earned abroad for a year. Some speculators had 20 or 30 apartments. Those who bought and sold time and again in Gangnam made a tremendous amount of money. (Author’s interview, conducted on 3 September 2008)
As Ms Chang pointed out, housewives willing to become indebted adopted more aggressive and adventurous strategies, buying multiple apartment units at the same time, which, if successful, would bring them windfall profits. Often referred to as ‘Mrs Realtor’ (pokpuin), 10 these women seized the opportunity to quickly climb the economic ladder and to amass wealth within a short time. In the midst of the Gangnan boom, even those who were less venturesome, such as Ms Chang, made plenty of additional income simply by moving frequently. Families could buy and sell their homes several times to take advantage of marginal profits, moving each time into a bigger and more expensive apartment, turning their homes into commodities with a high turnover ratio. A saying circulated among apartment owners: ‘Sell your apartment in three hours, you’re a speculator (kkun); in three days you’re a realtor (ŏpcha); in three months you’re an actual user (silsuyoja); in three years you’re an idiot’ (newspaper article in Dong-A Ilbo, 15 December 1982). Among ordinary apartment owners, frequent moves became the norm. According to a 1982 survey of a thousand apartment residents in seven major cities in Korea, 36.9% of households had moved three or four times before purchasing the apartments they currently lived in; of these, 54.9% were planning to move again within four years (newspaper article in Dong-A Ilbo, 15 December 1982). Even apartment owners who did not consider themselves speculators jumped on the bandwagon and tried to make profits out of selling and buying units.
Skyrocketing apartment prices meant that anyone who moved to a new apartment in Gangnam could quickly find themselves the owner of an expensive property. It was common to witness apartment prices in Gangnam increase manifold between the mid-1980s and mid-1990s, often by four times or more (Gelézeau, 2007: 141). The value of some popular apartments in Banpo, for example, increased by millions of won overnight in the early 1980s. The price of a 34-p’yŏng unit in the Woosung apartments rose from 38,000,000–49,000,000 won on 3 February 1983, to 48,000,000–53,000,000 won just two days later (Suh, 1983: 341).
Ms Ahn, a 65-year-old retired elementary school teacher who owns a 45-p’yŏng apartment in Banpo, is a paradigmatic Gangnam resident. Over the last 30 years, she has successfully moved up the housing ladder. In 1986, as Gangnam built up its reputation as a middle-class district with good schools, she bought a small 17-p’yŏng apartment for about 40 million won in Banpo. Since the apartment was fairly small for her family of four, her goal was to move to a bigger unit. In 1992, she sold her current apartment for 80 million won – twice as much as she had bought it for. With the help of a 40 million won loan from a bank, she bought a 32-p’yŏng apartment in the same neighbourhood for 120 million won. By 2009, this apartment was valued at 990 million won. She sold it, added her severance pay to the proceeds, and bought her current 45-p’yŏng apartment for 1.25 billion. Now it is valued at almost 2 billion won. Though her apartment is the only asset she owns, her life is quite stable and comfortable: an income of about 3 million won a month (her pension, plus an allowance from her daughters) ensures her financial security. While her history of moving and changing apartments might not be as dramatic as those of others, it is archetypical, showing that simply moving to Gangnam and owning an apartment there was often enough to bring good economic fortune. Like Ms Ahn, most of my informants told of beginning with a small apartment (smaller than 20-p’yŏng) in Gangnam in the late 1970s or early 1980s, and eventually obtaining a very large one (bigger than 40-p’yŏng) after perhaps a couple of moves.
Those who bought homes in Gangnam, whether as a result of careful decision-making or simply by chance, tremendously benefited from housing price inflation, which enabled them to acquire solid middle-class status. Yet the speculative, haphazardly regulated housing market also produced widespread demoralisation, and stoked resentment among those who did not benefit, a sense that simple luck or opportunistic speculative activities determined economic success and shaped the structural inequality between Gangnam residents and others. Most non-homeowners tightened their belts, lived frugally, and saved money to buy a home. It seemed to them that those who used the lottery programme as a means of real estate investment had ‘cut in line’, and by contributing to rising housing prices had made it more difficult for others to become homeowners. A novelist who lost in the lottery wrote about the fury it engendered in him: After finding out that we did not win the lottery, my wife was very disappointed and cried hard. I was not merely upset that we did not win the lottery – I was enraged. I felt betrayed by our neighbours, those who applied for tons of units, won multiple apartments, and sold the occupancy rights instantly, getting high premiums. Those are the ones who trampled on our aspirations to be homeowners and snatched our opportunity away. (Choi, 1977: 3)
While Gangnam apartment owners celebrated their good fortune, others had to watch their dreams of becoming homeowners vanish. Those who purchased homes in other areas than Gangnam regretted not having made the ‘right’ choices. People who started with similar qualifications – educational credentials, jobs, salaries – to Gangnam counterparts often experienced divergent economic outcomes. Gangnam’s property values increased so fast that apartments there were soon out of reach for those who had chosen to live elsewhere. It came to be considered a more or less ‘random’ process. Those who happened to move to Gangnam early enough could earn a tremendous fortune – one that was not necessarily a result of hard work and striving. The real estate boom in Gangnam meant possibility and opportunity for those with access to resources and the right connections; but it also meant a feeling of unfairness and relative deprivation for others.
Cultivating middle-class identities in apartment complexes
Even as Gangnam apartments were often associated with unprincipled, ‘illegitimate’ speculative activities, their inhabitants strived to cultivate modern, cultured, and Westernised middle-class lifestyles – in order to validate their wealth as ‘legitimate’ and showcase their collective identity as a vanguard of modernity and ‘cultured’ civilisation. Forming a distinctive cultural milieu and class identity, Gangnam residents saw their living space through a cultural lens of what class means.
New apartment buildings were not simply a new mode of housing. Living in an apartment meant a new way of life – a transition from a traditional, ‘backward’ lifestyle to a cultured, modern, Westernised one. Apartment living was often identified as an innovative, convenient, and civilised way of life: In the winter, we did not need to change coal briquettes in the early morning. Hot water was available anytime and it allowed one to take showers regularly. We could use elevators – helpful modern inventions – every day. My wife did not need to go to a market for grocery shopping daily. Instead, she placed her order on the phone, and small items were delivered immediately. Cultured life (munhwajŏgin saenghwal) had just started. (Kim, 1978: 54, emphasis added)
Apartments became popular among families at the ‘spearhead of modernisation’– nuclear families headed by young, educated professionals, including corporate managers, researchers, doctors, and professors (Kwon, 1978). Surveys in the 1970s and 1980s confirmed the fairly homogeneous demographic composition of Gangnam’s apartment residents. For example, in the Yeongdong neighbourhood in 1973, 76.8% of apartment-dwelling household heads had some college education or above, and most pursued typical white-collar, middle-class occupations as civil servants or salaried men (Seoul Metropolitan Office, 1996: 612). Their income earners were better paid than those in most working-class families. Before Gangnam was developed, it had the highest percentage of poor residents in Seoul, but after the binge of apartment construction, that percentage fell to less than 1% (Seoul Metropolitan Office, 1996: 605). Gangnam’s development displaced poor peasants in favour of middle-class families in apartment complexes.
When people with similar socioeconomic conditions live together, they develop a sense of community membership. This class identity becomes even stronger when they share similar lifestyles and distinguish themselves as a group from ‘others’. As Thompson noted, class should be understood as a ‘relationship’– class happens ‘when some men feel and articulate the identity between themselves and against other men’ (Thompson, 1966: 9). As apartment residents in Gangnam shared similar lifestyles, they developed a common identity between themselves; at the same time, their class identity and boundaries were further strengthened when they engaged in exclusionary practices against others.
The spatial characteristics of apartment complexes played an important role in developing a common identity among residents. Although some hierarchy and stratification existed between residents living in different-sized units, most apartment complexes included similar-sized units, with standardised layouts. This instilled in residents a sense that they shared common socioeconomic characteristics and belonged to the same class. Their lifestyles converged even more as they engaged in similar consumption practices. Apartment dwellers often compared themselves with their neighbours, learning what to buy and how to exhibit their status through their consumption. In order not to fall behind their neighbours, they purchased similar cars, furniture, and household commodities, and decorated their interiors in similar styles. The act of ‘keeping up with the Joneses’ through consumption practices homogenised middle-class culture and bolstered a sense of common identity.
This identity also depended on the practice of ‘making distinctions’ from non-apartment and non-Gangnam residents (Bourdieu, 1984). Gangnam residents described their neighbourhoods as ‘quiet’, ‘clean’ and ‘ordered’, and portrayed non-Gangnam neighbourhoods as ‘loud’, ‘narrow’, ‘bustling’, ‘chaotic’. From the perspective of Gangnam residents, living in Gangnam meant living in a more ‘civilised’ space. The modern facilities in apartment buildings gave residents not only a sense of comfort, but also a sense of pride that they were leading a ‘cultured’ lifestyle, in contrast to the ‘old-fashioned’ and ‘unenlightened’ way of life in traditional Korean houses. These binary distinctions, as perceived by Gangnam residents, were often developed into a sense of Gangnam’s ‘cultural superiority’. However, this attitude did not emerge only from the environment of the new apartment complexes; it also developed out of the residents’ cultural capital – the people understood themselves as more educated and enlightened than residents of other neighbourhoods. Ms Han, a 60-year-old Gangnam resident and wife of a medical doctor, described Gangnam residents as refined, sophisticated and proper: People [here] are more educated and intellectual. Thus, they might not be warm. But I like it because people here are cultured and have boundaries. I didn’t realize it before, but when I compare people here with those in other neighbourhoods, I feel the way of life [in other neighbourhoods] seems a bit much – too tiring. Children are different, too. Children there are rough. Children here are well-mannered. (Author’s interview, conducted on 10 June 2015)
Ms Han used a dichotomous and hierarchical rhetoric that distinguished between culturally sophisticated Gangnam residents on one hand, and ‘others’ lacking in those qualities and social skills on the other. Her perceptions of the cultural differences between Gangnam and non-Gangnam were common among Gangnam residents. To my question of whether she believes that there exists a different culture in Gangnam, Ms Lee, the 65-year-old housewife of a retired bank employee, who has lived in the Banpo apartment complex since the late 1970s, answered: [I believe that there exist] disparities in people’s qualities (sujun ch’ai). People who moved here to Gangnam had keen foresight (sŏn’gyŏnjimyŏng). They were culturally advanced (munhwajŏk ŭro ŭisik i itta). Thus, people here were very different from the very beginning. (Author’s interview, conducted on 22 June 2015)
Gangnam residents believed that these qualities could not be acquired simply with money. Though they had themselves taken advantage of appreciating housing prices in Gangnam, they also carefully distinguished themselves from parvenus (cholbu) who got rich overnight but lacked in cultural taste, civilised manners, and proper etiquette. As Ms Lee noted: There were people who had lousy lives, but became rich overnight because of the real estate price increase. They were different people from us. In every respect, in behavior and other things. But those who lived here for a long time were highly educated. Mostly professionals. Eighty percent of residents here were polite and hard-working, not nosy about others. (Same interview, conducted on 22 June 2015)
Thus, Gangnam residents tried to imbue Gangnam with cultural meanings. It was not simply an economically affluent area with new high-rise apartment buildings and modern infrastructure. Rather, it was a ‘culturally advanced’ space where the educated and civilised led modern lifestyles. They believed that Gangnam real estate became more valuable because of the educational attainments and cultural capital of Gangnam residents. By establishing the symbolic boundaries of Gangnam as an educated, cultured, and affluent space, they legitimised their economic success and upward mobility, which was often seen by non-Gangnam residents as corrupt and opportunistic.
The dominant discourse among residents on Gangnam, which portrayed it as an idealized abode of proper, cultured, and desirable middle-class society, was underpinned by exclusionary practices. Middle-class apartment complexes were separated and protected from the outside world by gates, walls, fences, and security guards. Their ‘civilised’ space could be maintained only when ‘low-class’ people were not allowed to intrude: uneducated, low-income families were always an imminent threat to middle-class apartment residents because their presence would lower the overall ‘quality’ of the area’s population, disrupt their cultured life and social order, and (most crucially) cause property values to decline. Apartment residents often stopped their children from playing with children living in public housing, because of the latter’s supposedly ‘rough’ and ‘poor’ manners (Hankyoreh, 8 November 1996). As Gangnam residents drew the physical and symbolic boundaries of Gangnam through exclusion and distinctive lifestyle practices – what Li Zhang identifies as the ‘spatialisation of class’ (Zhang, 2010) – Gangnam was made discernable as a new middle-class space and a new, class-based spatial order was created.
Conclusion
Through the case of Gangnam, I have illuminated how the particular conception and culture of the Korean middle class became materialised in apartment complexes beginning in the late 1970s. By promoting the construction of massive apartment complexes in undeveloped Gangnam, the Korean government allowed ordinary, salaried, white-collar families to purchase homes below market prices through the apartment lottery system. I have emphasised the speculative and exclusive nature of middle-class formation in this process. Only certain groups of people – those with stable jobs and incomes, such as government employees, white-collar workers in big corporations and finance, and professionals – could apply for the state-sponsored homeownership programme. Low-income families were completely excluded. Additionally, the state’s failure to regulate the housing market permitted large-scale speculative activities among ordinary citizens, and caused apartment prices to rise sharply. Thus, the particular ways in which Gangnam residents climbed the housing ladder and acquired middle-class status were widely seen as opportunistic, corrupt, and illegitimate, and became a source of frustration for those who did not benefit from state policy.
While economic status is important in becoming a member of the middle class, my study also emphasises the spatial and cultural components of class-making. Analysing how Gangnam residents made distinctions between their cultured, civilised, and Westernised lifestyles and culture, and the ‘unenlightened’ and traditional ways of others, this article demonstrates that Gangnam residents engaged in a struggle about their social and economic standing, and ultimately viewed their middle-class identity through a cultural lens. In doing so, they tried to legitimise their status – seen by many as the fruit of ‘illegitimate’, unearned income – as acquired through cultural capital.
Gangnam’s development as the embodiment of middle-class dreams raises broader questions about uneven, speculative urban development and the rise in spatial inequality. The growth- and efficiency-oriented developmental state promoted Gangnam by investing resources that benefited private developers and Gangnam’s middle-class residents while excluding many others. The real estate boom and housing price inflation that originated in Gangnam but later spread to other master-planned new towns have fixed the idea of housing as a means of capital accumulation and an object of investment, thereby exacerbating housing problems for the many unprivileged. This is not unique to Korea – speculative urbanism and housing crises are found in many countries, threatening the basic rights of ordinary citizens. It is a grave task to tackle how to make cities more equitable and inclusive.
Footnotes
Acknowledgements
The author thanks Ashok Das, Jennifer Darrah, Sukriti Issar, Jinwon Kim, John Logan, Joyce Mariano, Colin Moore, and anonymous reviewers of Urban Studies for their helpful comments.
Declaration of conflicting interests
The author(s) declared no potential conflicts of interest with respect to the research, authorship, and/or publication of this article.
Funding
The author(s) disclosed receipt of the following financial support for the research, authorship, and/or publication of this article: This research was supported by Brown University, the University of Hawaii-Mānoa, and the Core University Program for Korean Studies through the Ministry of Education of the Republic of Korea and Korean Studies Promotion Service of the Academy of Korean Studies (AKS-2014-OLU-2250003).