In a new venture in capitalist economics, North Korean authorities have begun offering high-rise apartments for sale to Chinese and North Korean investors with the option for new owners to sell them again at a higher price, North Korean sources say.
The apartments, built by the Dongyang Trading Company in North Korea’s Sinuiju city just across the border from China, are part of a scheme to raise badly needed foreign cash for Pyongyang, a source in China told RFA’s Korean Service.
“This is a North Korean project to launch speculative real estate investment in Sinuiju,” RFA’s source, a resident of the Chinese border city of Dandong, said, speaking on condition of anonymity.
The Dongyang Trading Company itself is controlled by North Korea’s elite Supreme Guard Command, a unit charged with protecting national leader Kim Jong Un and public sites connected with the ruling Kim family, the source said.
“They have the most powerful organization in the country working on this project, and they want to make North Korean residents spend all the dollars they have hidden in their closets,” he said.
Also speaking to RFA, a North Korean resident of Sinuiju said that anyone with enough money can now buy the apartments, even if they already own other properties.
“They are even allowed to re-sell the property later at a higher price,” he said.
“The Central Committee’s policy is not concerned with the source of the buyer’s funds,” he said, adding the units’ cost is “very high.”
Unit prices vary
The apartments are available in different price ranges, with cost tied to location, floor number, and the direction in which the apartment faces, with a 3,550 square-foot apartment needing interior work costing about $20,000, and larger apartments with a better view costing around $50,000.
“There is an additional cost of about $10,000 to $20,000 for interior work, so that a single apartment can end up costing more than $70,000,” he said.
“Elevators don’t run around the clock, but they do run in the morning and the evening during rush hour, so it’s not that inconvenient. And there are oil generators in each building to power the elevators and water pumps,” he said.
Apartment residents are responsible for the cost of running the generators themselves, he said.
Though North Korean authorities are now constantly tightening surveillance to guard against “anti-socialist” influences on society and are repressing the country’s residents, “they are still building high-rise apartments and promoting investment to raise foreign cash,” RFA’s source in Dandong said.
“I wonder how they will explain these contradictions to the people,” he said.
Reported by Joonho Kim for RFA’s Korean Service. Translated by Leejin Jun. Written in English by Richard Finney.