Desperate North Koreans sell homes to raise money for food

Some wealthy residents are snatching up real estate at bargain basement prices.
By Jieun Kim
Desperate North Koreans sell homes to raise money for food A picture taken in February 2019 from the Chinese border city of Dandong, in China's northeast Liaoning province, shows the circle-shaped luxury apartment building in the North Korean town of Sinuiju when it was under construction .

North Korean residents living near the border with China are selling their homes at rock bottom prices to raise money for food as the country prepares for winter amid the worst shortages since the 1990s famine.

Much of North Korea’s economy is dependent on trade with China, but commerce between the two countries largely came to a halt when the border was closed in January 2020 at the beginning of the coronavirus pandemic.

The closure not only deprived industry of raw materials and merchants with goods to peddle, it cut off food imports that could cover the gap between North Korea’s domestic food production and demand. Food prices have skyrocketed.

In the northwestern border city of Sinuiju, all but the wealthiest North Koreans are downsizing, just to be able to afford food this winter.

“Strange housing transactions are increasing with the sudden drop in temperature. Poor residents, who are suffering from hardship, are selling their houses to buy food, while rich people are taking advantage of this opportunity to buy houses at low prices,” a resident of the city told RFA’s Korean Service Nov. 22.

“As the number of houses for sale this winter increases, the prices for units in the circular-shaped luxury apartment building along the Yalu River are also plummeting. It is one of the best apartments in Sinuiju,” said the source, who requested anonymity for security reasons.

Those selling their homes in the circular building originally paid 30,000 yuan (U.S. $4,698) for a unit overlooking the river. But deteriorating economic conditions due to the prolonged coronavirus pandemic have lowered the asking price to half of that, according to the source.

Private ownership of houses is technically illegal in North Korea. The constitution states that all property is owned by the state, and the government typically grants living spaces to its citizens for specific periods of time.

This February 2019 file photo shows the then under construction circle-shaped luxury apartment building in the North Korean town of Sinuiju, behind the Broken Bridge, which once spanned the Yalu River between China and North Korea, as seen from the Chinese border city of Dandong, in China's northeast Liaoning province on February 22, 2019. Credit: AFP

“The person who bought the house can bribe the Urban Management Department of the Administrative Committee and receive a new housing permit. If you have a connection with the Urban Management Department or use a bribe, you can buy a house,” the source said

A high-rise unit in the circle-shaped building used to be the envy of the city’s elites, but times have changed.

“In the past, rich residents competed to buy an apartment there. … Most of them made a lot of money through trade with China. Residents are now struggling to make a living as trade between North Korea and China has been blocked for nearly two years due to the coronavirus crisis,” said the source.

A source from Sinuiju’s surrounding North Pyongan province told RFA that homeowners desperate for money will sell their housing permits to richer residents, then turn around and buy less expensive homes in the countryside.

“It is now difficult to get enough food for the day in the city. In winter, residents have to prepare food and firewood,” said the second source, who requested anonymity to speak freely.

“Finding drinking water from a long distance away sometimes requires selling a two-room house they bought by saving hard-earned money for only 1,000 yuan ($156).”

City life can be incredibly expensive during times of economic crisis, so many are leaving for more rural locations as quickly as they can, according to the second source.

“They are leaving their city homes vacant and moving to the countryside, even if their homes do not sell.”

RFA reported in 2019 that the widespread purchase and sale of housing permits prompted the government to test private ownership in the northeastern city of Rason, part of a special economic zone located in the country’s northeastern corner near China and Russia.

Under that plan, Rason sold the homes to the people who were living in them at the time, and many residents were interested in becoming bona fide homeowners.

A source in that report, published about nine months before the pandemic began, expected that the rest of North Korea would follow Rason’s example.

Translated by Claire Lee. Written in English by Eugene Whong.


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