First of all, half the population live in either the Greater Tokyo Area, or the Keihanshin area (Kyoto, Osaka, Kobe). Those areas are very dense. Second, it is

First of all, half the population live in either the Greater Tokyo Area, or the Keihanshin area (Kyoto, Osaka, Kobe). Those areas are very dense. Second, it is true that they don't have much usable land (but they still have some big flat areas), but outside of the aforementioned big cities, instead of building vertically, everybody wants to have their own house. The result is sprawling cities made of a combination of little houses and narrow streets cramped together, and big box stores connected by stroads.