Deconstructing the Japanese housing statistics

The 2008 Ministry of Internal Affairs and Communications housing statistics are out. Read them here, or just read my highlight reel below.

57.6 million homes in Japan and 13.1% are vacant

Anyone who has traveled through the countryside of Japan is probably not surprised at this. Several prefectures are now in the 15 to 20% vacancy range, including Yamanashi (the worst at 20.2% vacancy), Nagano, Wakayama, and all of Shikoku.

Stand-alone houses are in the majority, but high-rise apartments are slowly taking over

Of the total home count, 55.4% are stand-alone houses (一戸建). A dwindling 2.7% are row houses (長屋建), i.e. stand-alone houses clustered together sharing walls. The remaining 41.7% are group residences (共同住宅), like apartments and condos. These form the majority of homes in the Tokyo, Osaka and Nagoya metropolitan areas (52.1% of the three regions combined), and 56.4% of the housing stock around Tokyo.

Although the group residences were mostly one and two-story buildings back in the eighties, these low-rise units are less than 30% of the total apartment/condo count now. More than 30% of units today are in buildings of more than five stories, and 12.7% are in buildings of more than ten stories. Both proportions are steadily increasing.

More owners than renters

61.2% of Japan’s homes are owned, while 35.8% are rented (the remainder is “unverified”). About 6% of the total stock is owned by the government (public housing and Urban Renaissance Agency “UR” housing, about which I plan to write more in the future).

Owners have a heck of a lot more space

The average owned home has a floor area of 120.89 m2. The average rented home, on the other hand, has a floor area of 45.93 m2 (494 square feet for our American readers), which I find to be ridiculously tiny for anything resembling a “household.” (It would be interesting to see some more stats, like quintiles or something, or at least median numbers.)

Old people are taking over

8.3% of Japan’s houses are now occupied by single people over 65, and that number is rising (up 22.4% in the last five years). This shouldn’t come as too much of a surprise, since this is one of the most rapidly aging societies on Earth, but one must wonder who will take care of all these people in the event of a really major disaster. Like an extended LDP administration.

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26 thoughts on “Deconstructing the Japanese housing statistics”

  1. From an economic perspective, this makes no sense — how can there be so many vacancies but so little price deflation?

  2. “how can there be so many vacancies but so little price deflation?”

    My take on this is that many of the “vacancies” are abandoned / decayed (anyone know when a place stops being a “house” and becomes an abandoned ruin in Japan or the US and drops from the stats? Does the urban decay around Flint cease to be “houses”, for example) and thus don’t count as a cheapo that would bring rates down as people couldn’t / wouldn’t live in them as they are now. Even in inaka regional hubs (like where I am) there are many new mansions going up (I mean construction being started, not something that was started a while ago and is now being finished), despite the downturn – and this speaks to a new wave of movement to “urban” areas.

  3. “The average rented home, on the other hand, has a floor area of 45.93 m2 (494 square feet for our American readers), which I find to be ridiculously tiny for anything resembling a “household.” ”

    I wrote a story on Japanese danchi housing projects a while ago. The early postwar apartments – highly sought after and considered luxurious at the time – were about 35m2 for a maximum 5 occupants. 45.93m2 is a bit small for a family apartment in Tokyo today, but not dramatically so. In any case, Japan has a rapidly increasing number of single-person “households”.

  4. In any case, Japan has a rapidly increasing number of single-person “households”.

    This was my impression as well. There are more companies willing to build apartments with only studio-sized apartments (which are 20-30 sqm.) within a ten minute walk from a commuter train station. The company that builds the apartment offloads some of the risk by selling units to investors looking to diversify a portfolio with a rent stream. They in turn pay for it by taking out a housing loan, but the since the payments are so low, they can prepay and receive the subletting payments faster.

    If there is no tenant for the unit in question, I have seen terms like the building company guarantees for 90% of the rent payments, meaning the investor ends up with a 10% asset-liability mismatch.

    It turns out that there is not a whole lot of volatility in used apartment prices like there is in car prices. It’s kind of mind-boggling, but in many cases it deters the owner from making capital expenditures to refurbish the property they own. I don’t really understand why the market for apartment rents isn’t more elastic, but this is the story I’ve heard…

  5. In my experience, you don’t find many Japanese apartments over 100 m2, but there are a lot around that range and I would imagine that most families who are renting are doing okay (those types of places can be had for as little as 30,000 a month in some parts of the country). It is the large number of 18 m2 student and single places that bring the average down – and even those can cost an arm and a leg in the big cities.

  6. This is a very cool look at the housing situation!

    “houses are worth nothing in Japan”

    I can definitely see that the houses are built so shoddily only to last a maximum 50 years or so… It makes me wonder if there’s any real benefit to owning a house without the land besides the extra space and some marginal tax benefits. I am still in the process of investigating but it would be nice to own a real house some day unless it really is more trouble than it’s worth.

  7. There is a move these days to more durable houses, the crap that was shat out over the landscape in the high ec growth period being more or less an environmental disaster. These days one catchphrase is “200 year house”, and things have in fact been improving since the bubble years. Traditional houses are built well, and modern ones are pretty good too, but so much housing in Japan was built in the high growth era and that is basically as cheap as possible. Hence the reaction to 200-year homes and the like.

  8. Adamu – while I can’t recommend any specific company, many of the major house building outfits (Sekisui House, etc.) will have open houses in various areas showing off their new standard models. May be a good way to see what you can get for what price (keeping in mind that your mortgage will be at a much lower percentage than it would in many other countries). Getting some go and knock on the walls experience may put your house plans on the right track.

  9. I always thought Sekisui House was “Sexy House” when I first arrived in Japan and heard their ads. Now that would be a company I would be interested in looking at houses for….

    Personally I would never touch a brand-new house. My goal is a hundred-year old minka…

  10. 45m2 isn’t all that small by any standards. That’s a typical one-bedroom apartment in Sweden (my home country), and considered fine for a two-person household, or two parents and a child. And the idea of throwaway housing is as old as dirt in this country; it didn’t start with the postwar boom.

  11. You think, 46m² are tiny? Well, I live in a 49m² apartment in Germany, thank you very much. 😉 Actually it’s got lots of space and is more than enough for a one-person household.

    I think it’s quite interesting that so many houses and homes in Japan are empty. I also noticed this when living in a 100k town in Saitama a while ago. Also interesting that more than 60% are home owners. I always thought that Japan didn’t have that many home owners. No surprise about the 67.5% rate in the USA though on my side.
    My girlfriend also wants to buy/build a house some day. I’m still wondering how we possibly could pay for this. 😉

  12. ”And the idea of throwaway housing is as old as dirt in this country; it didn’t start with the postwar boom.”

    What are you referring to by this? The only thing I can think of offhand is the nagaya slum accomodations built by landlords in the shitamachi of Edo etc which were built cheap and crappily as they were expected to burn down in one of the many fires. Aside from that I am not aware of any housing that was deliberately not expected to last a decent time.

  13. Jade Oc, the predominant building material has been wood, which tends to get damaged by the high temperatures and humidity (molds, rot and insects). Add the risk of fire and other natural disasters and the typical expected time for a farmhouse or similar was apparently less than a century before it needed to be rebuilt. A farmer I’ve talked to said the old-style buildings would normally be remade after 60-80 years, or repurposed as a storage building while the new living quarters were erected next to it.

  14. Well, I don’t consider a century or even 80 years “throwaway,” as it is rather more than one generation. Wooded buildings survive quite well in Japan as well – as witness the many that have. However I would like to see more detail than one farmer’s anecdote. Do you know of any good reference books that go into this?

  15. We also have to keep in mind that 80 years in Edo Period time is 2-3 generations.

    Wasn’t it the roof being rethatched every 60-80 years? There are farmhouses in Japan well over 250 years old, right?

  16. Yeah, the roof gets rethatched pretty regularly – in the villages they basically went in turns and by the time they finished it was time to start again. About every 20 to 40 years. Nowadays, with fewer people to help out (save in places like Gokayama where volunteers come from all over the country) and the prices – say five million to rethatch – very few places are thatched any more, even those that were traditionally thatched – they get covered by tin roofs. And there are lots of places in Japan about 250 years old: the major enemy in fact is “progress”. Perhaps not as common as 17th century places in Europe, but a well-built minka will last a couple of centuries. They need looking after of course – regular fires in the irori to kill bugs for example – but weren’t built to be torn down by the next person to live there.

  17. “the predominant building material has been wood, which tends to get damaged by the high temperatures and humidity (molds, rot and insects). Add the risk of fire and other natural disasters”

    The first thing that I thought when I read this was that temples, clearly built to last for centuries, were also made of wood and to last in these conditions so this speaks more to the materials available than the mentality behind the construction, I think.

    I’ve heard that there are farm houses that have been around since “early Edo” – how old is the oldest that you have been to Jade? What about buke yashiki?

  18. I had a friend who lived in an inherited, all wooden house from early Edo period, in the sticks of Nara. Registered cultural property and in mint condition.

  19. The oldest farmhouse I have been to is mid-1600s from memory. Now, obviously these houses and temples need care. But I doubt they were thrown together with the thought “ah the hell with quality – it’ll burn down in a few years anyway.” The oldest wooden building I have been too is, as I am sure it is for most commentators here, the Horyuuji (well, specific parts thereof: the Kondo and one of the pagodas). There are very few really old buke yashiki around, since there are bugger-all real samurai houses left. Even cities that are famed for them have only a few. Farmouses and merchant houses have lasted well, on the whole. Hell, my wife’s place dates from Meiji 7 or so in its oldest parts. Japan’s oldest house (箱木家住宅) dates back to the year 806, in basic structure at least. That’s eight-oh-six, not 1806. It’s clearly been remodelled throughtout, as the interior is not Muromachi style.

    Now, if we were to look at the really poorest dwellings, it is a slightly different story. There are not that many left, for a number of reasons (not least being the desire for a better home) but the construction is clearly inferior. One big thing is that back in the day they actually dried timber properly before use: I’ve seen a lot of ‘minka-style’ places that have massive cracks in the beams from using improperly dried wood.

    Incidentally, the oldest wooden house in Europe is the Nideröst house in Switzerland, which is now dismantled and in storage, at 800 years. Difficult to findout what the oldest house in the world is – keep finding references to a 15,000 year old place made of mammoth bones, which doesn’t really count as I doubt it was lived in for the last few millennia…. Talking of oldest, Wiki-J’s list of Oldest Things in the World has Japan as oldest monarchial state with a date of 660BC…..

    You know, I’m not sure I would want to live in an RCP: a bit too restrictive with what you can do with it.

  20. “You know, I’m not sure I would want to live in an RCP: a bit too restrictive with what you can do with it.”
    In exchange for the restrictions, however, you pay zero real estate taxes, and can in fact easily get government money for renovations. Also, one section of the house was constructed recently enough (maybe Meiji) to be exempt from most of the restrictions, so that was where they actually setup the regular bedroom and stuff. On the other hand, your home is also listed on the local map as a cultural property, and tourists tend to wander in if you’ve forgotten to lock the door, thinking it’s a museum. My friends there were also required to open it to the public one or two days a year and play tour-guide.

  21. Okay, zero estate taxes could be very tempting. I wasn’t thinking so much of a bedroom as a modern kitchen and bathroom.

  22. Since the bathroom in old houses (even early 20th century machiya) is usually technically outside the main structure it’s not much interference to upgrade. They certainly had a modern kitchen- I don’t actually remember if it was in the preserved or “free” part of the house, but they do grant dispensations for a certain amount of modern renovation. For example, the whole place is wired for electricity, etc. But all of these things have to be individually approved by a government office, which is pretty annoying.

  23. “Since the bathroom in old houses (even early 20th century machiya) is usually technically outside the main structure”

    I would dispute that, depending on what you mean by “main structure.” All the minka/machiya I have been in or seen plans for (including samurai houses) had toilets inside, and those that had bathrooms were also inside. Or are you refering, with the machiya thing, about the area of the house in front of the tsubo-niwa, under the main roof? In which case it becomes a case of just how much does the ordinance cover – the main part alone, or the hanare or kura area as well?

    By the time municipal water was being installed, incidentally, kitchens and bathrooms migrated to the front of the house to be close to the pipes (in newly-built houses, such as the 文化住宅).

  24. OK, I was kind of inaccurate there, and yes I was referring to what you thought I was.

    “In which case it becomes a case of just how much does the ordinance cover – the main part alone, or the hanare or kura area as well?”
    Well, I assume it’s every part that’s older than a certain date, but I really couldn’t tell you. I do recall that the kura of this house was NOT covered, but it could be because it was too heavily rebuilt in a more recent period.

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