＜Inside N.Korea＞ Expansion of the market economy as the driving force behind social transformation--based on sources from inside N.Korea. (PART5) State-owned houses sold in the markets as the housing market established. by ISHIMARU Jiro

2016.12.26

The first and the second floor from the previous picture. The frames on the windows prevent theft. The apartment’s owner intended to gain an return on investment as early as possible. October 2008 in Haeju City, South Hwanghae Province. Taken by Shim Ui-cheon (ASIAPRESS)

4-3 Construction investments for businesses

As mentioned above, people called “Tonchu (lord of money)”, the new entrepreneurs, have emerged as early as the 2000s. They are successful business people in the ever-expanding North Korean market. Their success was gained by usually taking advantage of the privileged, with corrupt high ranking officials and the people who surround them. Reportedly, they have started to individually or collectively build apartments in excellent locations since around 2005.

Since it is not possible for an individual to claim the ownership of apartments, the Tonchu construct and register them in the name of the state. They then sell a “permission” to those who want to purchase an apartment. They are state-owned buildings on the books, but are actually private property no different than that found in capitalistic markets. As of the summer in 2015, the prices of the luxury apartments increased; some of them are sold at around 200,000 USD in Pyongyang, and 30,000 – 50,000 USD in rural areas.

The marketization of state-owned housing can be a significant threat to the cornerstone of the North Korean-style socialist state. It has come about because the government has been unable to find a solution for the housing problem in the country, leaving the demands of the people in their own hands. The “black housing market” emerged naturally out of the people’s needs and has been carrying out the a role for housing transactions instead of the once relied upon state. [To be continued in part 6]

＜Market Economy in N.Korea＞ View article sections

Reference List:

ASIAPRESS , “Rimjin-gang, edition-second”, March 2010,

Jeong Eun-Yi, 「북한에서의주택가격결정요인에관한분석－함경북도무산지역의사례를중심으로」(Analysis regarding factors determining housing prices in North Korea–the main focus in Musan County, North Hamkyung Province), The Northeast Asia Economic Association of Korea, “The Northeast Asia Economic Studies. Vol. 25. No.3”, pp. 243 – pp. 277,July 2013.

Jeong Eun-Yi,「북한부동산시장의발전에관한분석－주택사용권의비합법적매매사례를중심으로－」(Analysis regarding the development of the property industry in North Korea–the main focus is the illegal transaction of the “permission” to use a house),The Northeast Asia Economic Association of Korea, “The Northeast Asia Economic Studies. Vol. 27. No.1”, pp. 289 – pp. 328,March 2015.

* Editor’s notes on North Korean reporters
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