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In Japan in 1990, did people suddenly stop wanting to be in Tokyo? If so, why has the population of the country been pouring into Tokyo ever since? If not, how
by mitthrowaway2 4y ago
In Japan in 1990, did people suddenly stop wanting to be in Tokyo? If so, why has the population of the country been pouring into Tokyo ever since? If not, how does that square with Japanese real estate being almost the most terrible investment you could make in that year?
http://www.thebubblebubble.com/wp-content/uploads/2012/05/Japan-Real-Estate-Prices.jpg http://www.thebubblebubble.com/wp-content/uploads/2012/05/Ja...
Maybe land in popular places is always a good investment, or maybe that sentiment is already factored into the price when you buy in, and subsequent returns are mainly driven by macro factors like interest rate adjustments and banking crises?
- nemo44x 4y agoJapanese homes are disposable like trailers in the USA. They are often demolished and fully replaced after 20 years or changing hands. So yes, investing in a disposable thing would yield poor results.
- mitthrowaway2 4y agoThis argument makes no sense, no matter how often it's repeated. The Japanese housing bubble crash represents investment losses on land, even empty lots, and is not a result of high upkeep costs. The losses in that graph represent many several multiples of the cost of the structure. Furthermore, depreciation of structures happens everywhere worldwide, and while it may happen faster in Japan, it's mostly balanced there by low construction costs.