With a population of 23 million and growing, Beijing is dealing with a major housing shortage. That's why thousands of immigrants looking for affordable homes in the city are going underground — literally and figuratively. A thriving gray market exists for windowless apartments buried deep below the streets.

But why are so many people able to find subterranean homes? It all goes back to a housing policy that the government instituted in the 1950s. At that time, contractors were required to construct new buildings with large basements that could double as air raid shelters — that meant basements had to be fitted out with electricity, plumbing, and sewer pipes. So there was already a ton of livable underground space in the city when the population began to explode in the 1980s. At that point, the government started allowing landlords to turn these basements into residential units. Some buildings were able to carve out as many as 600 units below ground. But in 2010, Beijing stopped giving out housing permits for subterranean units and announced plans to evict everyone living in them.

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Of course, people kept living there. Immigrants from the countryside are pouring into Beijing looking for jobs, and the city is incredibly expensive. Everyone from the mall workers in the picture above, to journalists and managers, are turning to tiny underground apartments to survive.

That's when USC public policy professor Annette Kim decided to conduct a study of what it was like for these underground residents in Beijing. What she discovered, as she reports in a fascinating article for the Lincoln Institute of Land Policy, is that many landlords in 2014 are still renting these illegal units quite openly. She surveyed 3,677 online rental ads for subterranean apartments to gain a general sense of what they are like.

Kim writes:

The median size is 9.75 square meters, slightly smaller than Beijing's 10-square-meter minimum and the overall average housing area per capita (28.8 square meters per person). Even so, the apartments are generally larger than the average worker dormitory housing, which is just 6.2 square meters.

The mean monthly rent of 436 RMB (US$70) confirms that the apartments are at the higher end of migrant housing. A 2012 government study found that about 48 percent of migrants in Beijing pay less than 300 RMB (US$48) per month, 27 percent pay 301 to 500 RMB (US$48–80), and 17 percent pay more than 1,000 RMB (US$160). In other words, these underground rental units are generally a higher-valued type of shelter for migrants than the more common worker dormitories and urban village housing.

On average, subterranean units are less than 11 kilometers from the city center, with a standard deviation of 6.2 kilometers, placing them well within the 5th Ring Road. With these locational advantages, the apartments offer potentially lower commuting costs and better economic opportunities. Similarly, the average distance to the nearest subway station is a little over 1 kilometer, which is considered within walking distance.

One of the interesting things she discovered right away is that life underground isn't that bad. Yes the units are small, but they're actually bigger than a lot of worker housing. Many of them are close enough to the city center that people can walk to work or public transit. And, though many basement dwellers have no windows, often they do have some amenities like internet access, air conditioning, and security. In the chart at left, you can see a list of features in the apartment ads she surveyed.

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Ultimately, Kim concludes, living underground is a reasonable option for people who have recently relocated to the city and need affordable housing. She suggests that the units work well for people who will live there for just a few years while finding their feet in Beijing, before moving on to a more stable living situation. Kim also thinks these units are a reasonable solution for temporary workers or students in the city who need inexpensive places to stay.

Underground, windowless apartments may sound dystopian, but Kim's careful analysis reveals that they may actually be a reasonable solution to Beijing's housing crisis.

Read the full study at Lincoln Institute of Land Policy