Bridge to North Korea across the Yalu River
SUMMARY
In the wake of political progress between North and South Korean leaders, a little Chinese town just over the Yalu River from North Korea has seen an unprecedented real estate boom. In the border city of Dandong, China, home prices for rent doubled from 3,000 yuan (USD$471.50) to 5,500 yuan (USD$863) in the two days before the inter-Korea summit between North Korean leader Kim Jung-un and South Korean President Moon Jae-In on April 27. Property investors from Beijing, Shanghai, and Tianjin have come to Dandong in droves looking to buy up real estate, but locals are concerned with the creation of a possible housing bubble. After a sharp deterioration in Chinese-North Korean relations last year, Dandong real estate prices took a major hit but started a slow recovery with positive signs after Kim’s landmark visit to Beijing in March. Experts say that the Dandong’s housing market is likely to see further skyrocketing of prices if the United States-North Korea summit is successful. In the past, there was some spiked interested in the area around the announcement of the construction of a bridge crossing the Yalu River to open November 2015, but today it sits unused because it remained closed on the North Korean side.
FAO GLOBAL ASSESSMENT
The relatively undeveloped nature of the Dandong area makes it a prime location for investment. If North Korea opens its borders or allows more substantial legal movement between the two countries, there will be loads of demand for Korean language media, Korean products, Chinese-Korean language centers, and housing. Due to China’s low housing costs outside of major urban centers, property investment for foreign firms carries minimal risk. Even now at their higher prices, in some areas average home in Dandong lists at $863 per square meter, home prices still trail behind other major Chinese cities. While it is possible to navigate the complex laws that often hinder foreign investment firms, mounting trade tensions between China and United States will likely deter significant investment from western firms into the city until the North Korea tensions are reduced and recent trade disputes are resolved.
Related Links
- UPI – Report: Real estate is booming in Chinese city near North Korea
- GB Times – Real estate prices at China-North Korea border city double within 48 hours
- South China Morning Post – Rocketing prices? Chinese property speculators hope for peace premium as they move in on North Korea
- Global Times – Real estate prices rise at China-North Korea border city
- Huffington Post – The Median Home Price is $188,900. Here’s What That Actually Buys You.
- Washington Post – On China’s border with North Korea, a constricted economic lifeline is still a lifeline
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