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Analyst: Kim Jong Un leery of rising home prices

North Korea's Kim Jong Un has been enforcing a housing law to curb real estate prices, according to a South Korean analyst. File Photo by KCNA/UPI
North Korea's Kim Jong Un has been enforcing a housing law to curb real estate prices, according to a South Korean analyst. File Photo by KCNA/UPI | License Photo

Dec. 17 (UPI) -- Informal marketplaces have multiplied in North Korea under Kim Jong Un, but the North Korean leader could be wary of soaring real estate prices, a South Korean analyst said.

Choi Cheon-woon, a professor at the Institute for Far Eastern Studies at Kyungnam University, said in an analysis published Thursday that North Korean housing prices rose in the 2000s in correlation with the rise of markets or "jangmadang," Newsis reported.

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Choi also said Kim initially took a laissez-faire approach to the economy since fully assuming power in 2012. Under previous leaders, the state controlled the price of housing and land. Choi said his research indicates Kim, who observed his father's death anniversary Thursday, left real estate prices largely to market forces.

North Korea remains wary of the domestic housing market heading into overheated territory, however, Choi said.

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According to the analyst, North Korea's economy transformed dramatically in the '90s, during and after a famine that is estimated to have killed millions of people.

During the decade, the state stopped monopolizing the housing supply, but by 2009 Pyongyang began to enforce a housing act that would allow the state to intervene if prices began to rise. Kim began to use the law to "stabilize prices," Choi said.

"North Korean authorities are likely to continue to recognize the economic importance of the real estate market," Choi said. "Future urbanization, appreciation in the value of real estate and the rise in real estate usage fees [rent] are important areas for observation."

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North Korean state media and politicians rarely mention the rise of informal markets in the country, but analysts in the South say at least 500 markets for private vendors operate in the country.

Kim observed father Kim Jong-il's ninth death anniversary Thursday with a visit to the Kumsusan Palace of the Sun, according to Pyongyang's Rodong Sinmun.

Kim, who was seen at the memorial with sister Kim Yo-jong, previously called on citizens to launch an 80-day campaign to attain goals in every sector of the economy.

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