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Why Japan Is Crazy About Housing

153 points by ezl 13y ago

ezl 13y ago
i found it interesting that depreciation is expected on your property and houses are expected to have no resale value.
- segmondy 13y ago
  same way i find it interesting that the same piece of property can cost $100k in one place and $1 million else where simply because of location. Man can be a very irrational animal, and once he has rationalized some useless idea into being, he can't shake it off his head.
  - jonnathanson 13y ago
    Location isn't irrational. In fact, it's probably one of the most rational factors in real estate pricing in the US. It's one of the few factors that's driven largely by the market forces of supply and demand. Locations are "hot" because they're in places with good jobs, good services, good schools (though this one needs an asterisk), access to amenities and culture, etc. Locations are "cold" to the degree that they're in high-crime, poor-service areas, or in remote areas without job prospects. Nobody wants to live in these areas, so with reduced demand come lower prices. A 2,000 square-foot home costs $100k in rural Montana and $1M in Southern California because millions of people want to live in SoCal, and relatively few people want to live in rural Montana. Housing prices in Detroit are low because the job market in Detroit has been cratering for decades while crime has been increasing. A home with a seaside view is worth more than a similarly proportioned home abutting a freeway, because people would rather look at the former than the latter. A home in San Francisco is worth a fortune because lots of people with lots of money want to live here, but the inventory (supply) is limited. Etc. Plenty of factors in real estate pricing are highly irrational. With few exceptions, location isn't one of them. When people pay for location, they're not paying for the house on that location; they're paying for the location itself. That's why comparing X square feet in Y area to X square feet in Z area isn't apples to apples.
- randomdata 13y ago
  Even in North America, houses are considered a depreciating asset. The property on which the house sits is what tends to appreciate, hopefully offsetting the losses on the house (at least from the owner's point of view). But with negative population growth and virtual no immigration as is the case with Japan, fewer properties are needed to sustain the decreasing number of people. Supply exceeds demand, so prices fall.
  - tostitos1979 13y ago
    How does this work for condos?
    - ghaff 13y ago
      The numbers I've seen suggest that condos on average actually appreciate more than houses even in a given location http://re-sanfrancisco.com/10-years-of-san-francisco-condo-vs-house-appreciation/ http://re-sanfrancisco.com/10-years-of-san-francisco-condo-v... But I'm not sure how much you can conclude from that as a condo could still appreciate (i.e. someone would be willing to spend more money for it) even if the underlying physical plant were deteriorating at some rate. It's probably also worth noting that, in a lot of cases in the US, single family homes in particular don't necessarily deteriorate. People do maintenance, redo their kitchens, add decks, etc.
    - refurb 13y ago
      As a condo owner, you also own a representative share of the land the condo is built on (not an actual plot, but an interest in the total value of the land). The condo can depreciate, but if the land appreciates, the overall value of your share can appreciate.
girvo 13y ago
Every time in read about the Japanese "salaryman" culture, it makes me sad... And then wonder whether the West will end up somewhere similar in the future. This article had that effect on me, but it also made me angry; taking it at face value, it shows that salarymen have it even worse than I thought :( They do get interesting architecture out of it, but that's hardly a good trade off for geographic permanence and a lack of financial movement... Or is it? It's hard to grok other cultures, despite my best efforts. Maybe it is worth it to them? One thing seems to be certain across cultures: no one is happy and everything sucks ;)
- yxhuvud 13y ago
  Probably not - the West used to have much more of a salaryman culture with lifelong employment, but the trend is going in the other direction.
- rayiner 13y ago
  > a good trade off for geographic permanence and a lack of financial movement Many people, even Americans, see things the opposite way. They don't like the idea of having to move far away from their parents to find a decent job, or have to uproot their families at the drop of a hat when a job ends. I grew up in D.C., went to college and worked in Atlanta, went to graduate school in Chicago, got a job after in New York. My wife grew up in Oregon, went to college in Iowa, worked in Chicago and D.C., went to graduate school in Chicago.[1] Now we work in Wilmington and Philadelphia, and next year we're moving to Baltimore. This is the nature of the modern American economy, where you move around to find opportunities, but unless you're a single childless early 20-something it makes the rest of life very logistically complicated. Certainly among my friends, who are getting into their 30's, long-distance relationships are quite common and nobody is really thrilled about them. [1] In comparison, my wife's parents grew up in the same city and went to high school together, less than 50 miles from where her dad's family settled during the wagon trail days.
  - tostitos1979 13y ago
    It is interesting to read your comment. Curious if you know married couples who have to be apart and how this affects their marriage? When both husband and wife have specialized jobs, it seems the choices are to compromise on one person's career or too live apart for at least some periods of time.
squozzer 13y ago
A very interesting piece, revealing a cultural side-effect I had not expected. The stereotype we hold in the West about Japan is that conformity is the norm, which for the most part holds. But not in housing it seems. They have my admiration AND sympathy.
- snogglethorpe 13y ago
  The houses shown are far from typical... :]
ggreer 13y ago
They glossed over one of the biggest reasons houses are demolished after a few decades: earthquakes. Thirty years of earthquakes will ruin any house that's not a bomb shelter.
- userulluipeste 13y ago
  That's not really a reason. Romania has an active epicenter of earthquakes and the houses are not demolished/rebuilt that often. When designing and constructing buildings, there are also just some seismic requirements, that's all. There isn't any planned obsolescence involved and I haven't heard of much earthquake damage since 1977.
  - ggreer 13y ago
    In the past ten years, Japan has had 21 earthquakes of magnitude 6.5 or greater. In the past 100 years, Romania has had 5.
    - andrewcooke 13y ago
      chile doesn't demolish houses like this either. i don't know where you're getting 6.5 mag data, but for 8+ we're very similar to japan - http://earthquake.usgs.gov/earthquakes/eqarchives/year/mag8/magnitude8_1900_date.php http://earthquake.usgs.gov/earthquakes/eqarchives/year/mag8/...
- Retric 13y ago
  Yet San Francisco is filled with older homes... No, the real reason is the delta between a tiny but valuable home and junk in 30 years is not that high because construction is cheap due to climate and the time value of money eat's what little value might be there. For most people they get most of there value from simply living in the house. PS: US, also spends a lot of our GDP on housing construction we just value the land vs home differently because of cultural reasons and construction materials. Despite the demonstration from the rust belt that it's mostly the land that's valuable not cheap homes. aka location location location
Alexx 13y ago
Fascinating. I had absolutely no idea. As someone who lives in a property that's over 140 years old, which has been fully renovated, modernised, and improved (at a guess) maybe 10 times over its life I find the idea of housing as a disposable assets rather alien. Granted, there are no earthquakes here. I wonder what the social and economic trade off is between maintaining and modernising a building for hundreds of years (considering energy efficiency and standard of living too) vs just knocking it down and building a new one every 30 years. The article doesn't mention the effect this has on the rental market - If the asset depreciates I can't imagine being a landlord is a very lucrative proposition?
- fjk 13y ago
  "If the asset depreciates I can't imagine being a landlord is a very lucrative proposition" That's not necessarily the case. Traditionally, landlords make money on 1) cash flow from tenant rents and 2) appreciation of the property at the eventual exit. In Japan, it seems like 2) is out of the equation, but if 1) is high enough, owning rental properties could be very lucrative for landlords, especially if there's high demand for rental properties. Detroit is a market that's experiencing an increase in rental properties even though appreciation is practically nothing in most areas.
staunch 13y ago
The brand new apartment I moved into near the center of Tokyo in 2006 is now something like 30% cheaper than it was then. Whereas refinished 1930s era apartments in LA are like 50% more expensive. I absolutely love the constant push to modernize everyone's home. Why shouldn't home technology evolve like any other. Of course it's expensive and wasteful, but so is buying an iPhone 5s.
- rayiner 13y ago
  > Why shouldn't home technology evolve like any other. Because it doesn't. Home technology evolves so slowly, that the analogous situation in the tech world would be if you could simply upgrade the memory and hard drive on your 286 to be able to use the latest and greatest software.
  - blacksmith_tb 13y ago
    Yes and no - the idea of insulating existed 100 years ago, but the materials weren't the greatest (attics full of horsehair, etc.). And the cheapness of fossil fuels made it seem mostly unnecessary. Moving from a drafty 1921 home to a passive house that was built this year, the difference for me was striking. Some of the improvements can be retrofitted onto older homes (PV, blown-in insulation, attic insulation), others, not so much (windows and doors are more painful to replace, e.g.).
    - rayiner 13y ago
      Sure, windows and doors are more difficult to replace, but it's all quite doable, which is striking considering the century that passed in the meantime. It's a testament to how slowly housing technology evolves.
    - masklinn 13y ago
      > the idea of insulating existed 100 years ago, but the materials weren't the greatest (attics full of horsehair, etc.). Mineral wool commercial production started in 1871 in Germany, and asbestos started being used as insulation material in the 1860s in North America.
deleted 13y ago
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deleted 13y ago
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nostromo 13y ago
Do building codes & zoning play a role in this? I've seen some crazy structures in the US, including a castle in Northern Idaho, but they tend to be in places with lax building codes (or lax building code enforcement) no HOAs and no urban zoning. Just in the start of the article they mention a few things that we be hard to build legally in the US: handrail-less stairs, rail-less balconies, windowless rooms & houses.
kohsuke 13y ago
A Japanese here. I think this article fell into the same trap that many other similar articles fell into. Namely, in trying to make the article interesting, it attributes more to the culture and psyche, ignoring more mandane logical reasons. One of the primary reasons houses depreciate in value so rapidly in Japan is simply because that is the accounting rules. If you look at http://www1.m-net.ne.jp/k-web/genkasyokyaku/genka-tatemono.htm http://www1.m-net.ne.jp/k-web/genkasyokyaku/genka-tatemono.h... (and I hope Google Translate translates it well), you see that the typical wooden houses (the kinds you see in California, where I live) depreciate competely in just 20 years in the eyes of tax agency. This has real effect on mortgage. The rules around the market are different, too. For example, in California most houses are sold and bought as-is. In Japan, the seller is on the hook for up to an year for problems that weren't discovered at the point of sale. These differences depress the existing house market, and that is made up by the new house market, which in turn translates into a lot more new houses. I find this report from Ministry of Land, Infrastructure, Transport and Tourism highly educational. It comes with lots of numbers: http://www.mlit.go.jp/common/001002572.pdf http://www.mlit.go.jp/common/001002572.pdf more
- ChuckMcM 13y ago
  Thanks for the links, Google Translate did enough :-) I find this fascinating: "The rules around the market are different, too. For example, in California most houses are sold and bought as-is. In Japan, the seller is on the hook for up to an year for problems that weren't discovered at the point of sale." In California there are many rules, permits, and processes that must be followed before building a new house. This comes from voters (residents) seeking to limit the rate of change in their neighborhood, and restrict change they would find objectionable (like multi-floor houses in a neighbor with all single floor houses). So buying an existing house is always "easier" than building a new one. Buyers are not responsible for any problems that were disclosed at the time of purchase and signed off on by the buyers. The buyer has the option (and should) to get a thorough home inspection prior to the purchase. Contrast that to Las Vegas were my I spent my formative years where new houses were the norm and 'old' houses were depreciating because why buy an 'old' house when a 'new' one was the same price? This continued for a long time and pretty much covered the valley floor there with very similar looking houses. That has slowed some now that land to build on is quite far away from the rest of town. But I could see that tearing down houses on land closer to town and rebuilding them might improve the value of those houses. The bottom line for me is that clearly municipal regulation has a lot more influence on home 'value' than a nominally open market would suggest. I always knew it had a some effect but it seems possible that it is perhaps the dominant effect.
Ashley46 13y ago
======= Jobs For Usa Canada Uk Australia & New Zealand ======== Now you can make alot of money online for some interesting online work As Daniel implied I didnt know that a student can get paid $8585 in a few weeks on the internet. view it now Just visit the site & Open Home tab for more details....................... Wow40.ℂℴm
WalterBright 13y ago
It seems a lot like cars in the US, where people regularly discard perfectly good cars and buy new ones. In my extended family, we tend to keep cars for decades, driving them daily. If you keep them maintained (and maintenance is cheap), you can keep them operating just fine for a long time. Heck, my truck is 25 years old, I've had it for 20 years, costs me about $300/yr in maintenance, insurance is cheap (no collision), no worries about somebody stealing or damaging it, and I go out on a frosty morning, turn the key, and it starts right up. I don't feel any urge to replace it with a new one.
- TylerE 13y ago
  The japanese are even more insane there. Their inspections are insanely expensive, to the point where cars older than 5-6 years have essentially negative value, as the biannual inspection would cost something like $5k. http://followrory.blogspot.com/2013/06/shaken-car-inspection-in-japan.html http://followrory.blogspot.com/2013/06/shaken-car-inspection...
  - WalterBright 13y ago
    Other than the absurd "cash for clunkers" program, the government here is fairly friendly to us old car drivers. For example, a couple days ago was the last time I have to have my truck emissions tested. At 25 years of age it drops off the radar. My 40 year old Dodge now qualifies for "collector plates" where, for a one time fee, I never have to pay the annual registration fee again. And, of course, there is quite an industry in the US providing repair/maintenance parts for those old machines for far less money than parts for new cars. It's really quite nice if you like having those cars.
    - TylerE 13y ago
      US regulation is weird. Stuff that is wildly not compliant to modern standards is grandfathered in, while stuff that in many respects meets MORE stringent standards (e.g. anything sold in western europe) can't be registered.
drderidder 13y ago
Avante garde houses like those shown in the article are still very much the exception and not the norm in Japan. It's true that some Japanese architects are pushing the envelope but vernacular housing in Japan today is exemplified by companies like Daikyo, Mitsue, etc and not by these modernist custom designs.
bhewes 13y ago
Actual the fact a house deprecates makes more financial sense then what he have in the US. A house is an expensive durable good. Land is the asset that appreciates. Nothing crazy about separating the two.
mosselman 13y ago
I read 'hosting'.
VexXtreme 13y ago
I live in Japan and I find the housing here completely abysmal. The construction practices are very poor and even if you shell out for an apartment in a new mansion, expect to find paper-thin walls, no heat insulation and overall very shoddy construction quality. In the winter my (fairly new) apartment gets almost as cold as outside and getting up in the morning always requires running the AC for half an hour first. Single pane windows are standard, there is no central heating and walls are hollow and very thin. I can literally hear my neighbor taking a shower every night, and don't get me started on being able to hear passersby on the street all night long, despite the fact that I live pretty high up. This is an absolutely amazing 1st world country with 3rd world construction practices. I blame it on several factors: 1. Cheap and scammy construction companies that try to maximize their profit margin by using cheap materials and poor building practices. 2. People who don't know any better. Most Japanese people assume that what they get is standard and fair. 3. The pervasive Japanese mindset that everything is disposable, replaceable and ephemeral. In Japan, little value is generally placed on long term value of things. The house where I grew up in Europe is built like a castle compared to even some of the best houses I've seen here. If this doesn't sound crazy enough, there are a lot of carbon monoxide related deaths every winter in Japan because many people (especially elderly people) use an ancient heating system called /kotatsu/, where they burn coal under a small table that's covered with a blanket. My girlfriend once got burnt badly because she fell asleep under her kotatsu and accidentally touched the heater. Don't get me started on electric blankets and similar nonsense, which is all over the place.
- hoi 13y ago
  I also used to live in Japan. Construction has to follow guidelines to ensure they comply to earthquake standards and Japan is one of the leaders in earthquake - proof technology. Part of this may come in the compromise of 'thinner walls'. This in part also explains why tearing down a house and building a new one is desired, as you would want the most modern earthquake proof property. I haven't lived in a place in Japan that wasn't double glazed and central heating is not really required since most of the year heating is not required (at least in Tokyo). Without trying to sound 'patronizing', you sound a bit like a foreigner who hasn't yet fully adapted to Japan.
yetanotherphd 13y ago
"Why Japan/China/Korea does X stupid thing" followed by some orientalist explanation is becoming very common. If you wrote a similar article about an African or Jewish country you would probably lose your job.

153 points by ezl 13y ago

ezl 13y ago

i found it interesting that depreciation is expected on your property and houses are expected to have no resale value.

segmondy 13y ago
same way i find it interesting that the same piece of property can cost $100k in one place and $1 million else where simply because of location. Man can be a very irrational animal, and once he has rationalized some useless idea into being, he can't shake it off his head.
- jonnathanson 13y ago
  Location isn't irrational. In fact, it's probably one of the most rational factors in real estate pricing in the US. It's one of the few factors that's driven largely by the market forces of supply and demand. Locations are "hot" because they're in places with good jobs, good services, good schools (though this one needs an asterisk), access to amenities and culture, etc. Locations are "cold" to the degree that they're in high-crime, poor-service areas, or in remote areas without job prospects. Nobody wants to live in these areas, so with reduced demand come lower prices. A 2,000 square-foot home costs $100k in rural Montana and $1M in Southern California because millions of people want to live in SoCal, and relatively few people want to live in rural Montana. Housing prices in Detroit are low because the job market in Detroit has been cratering for decades while crime has been increasing. A home with a seaside view is worth more than a similarly proportioned home abutting a freeway, because people would rather look at the former than the latter. A home in San Francisco is worth a fortune because lots of people with lots of money want to live here, but the inventory (supply) is limited. Etc. Plenty of factors in real estate pricing are highly irrational. With few exceptions, location isn't one of them. When people pay for location, they're not paying for the house on that location; they're paying for the location itself. That's why comparing X square feet in Y area to X square feet in Z area isn't apples to apples.
randomdata 13y ago
Even in North America, houses are considered a depreciating asset. The property on which the house sits is what tends to appreciate, hopefully offsetting the losses on the house (at least from the owner's point of view). But with negative population growth and virtual no immigration as is the case with Japan, fewer properties are needed to sustain the decreasing number of people. Supply exceeds demand, so prices fall.
- tostitos1979 13y ago
  How does this work for condos?
  - ghaff 13y ago
    The numbers I've seen suggest that condos on average actually appreciate more than houses even in a given location http://re-sanfrancisco.com/10-years-of-san-francisco-condo-vs-house-appreciation/ http://re-sanfrancisco.com/10-years-of-san-francisco-condo-v... But I'm not sure how much you can conclude from that as a condo could still appreciate (i.e. someone would be willing to spend more money for it) even if the underlying physical plant were deteriorating at some rate. It's probably also worth noting that, in a lot of cases in the US, single family homes in particular don't necessarily deteriorate. People do maintenance, redo their kitchens, add decks, etc.
  - refurb 13y ago
    As a condo owner, you also own a representative share of the land the condo is built on (not an actual plot, but an interest in the total value of the land). The condo can depreciate, but if the land appreciates, the overall value of your share can appreciate.

girvo 13y ago

Every time in read about the Japanese "salaryman" culture, it makes me sad... And then wonder whether the West will end up somewhere similar in the future. This article had that effect on me, but it also made me angry; taking it at face value, it shows that salarymen have it even worse than I thought :( They do get interesting architecture out of it, but that's hardly a good trade off for geographic permanence and a lack of financial movement... Or is it? It's hard to grok other cultures, despite my best efforts. Maybe it is worth it to them? One thing seems to be certain across cultures: no one is happy and everything sucks ;)

yxhuvud 13y ago
Probably not - the West used to have much more of a salaryman culture with lifelong employment, but the trend is going in the other direction.
rayiner 13y ago
> a good trade off for geographic permanence and a lack of financial movement Many people, even Americans, see things the opposite way. They don't like the idea of having to move far away from their parents to find a decent job, or have to uproot their families at the drop of a hat when a job ends. I grew up in D.C., went to college and worked in Atlanta, went to graduate school in Chicago, got a job after in New York. My wife grew up in Oregon, went to college in Iowa, worked in Chicago and D.C., went to graduate school in Chicago.[1] Now we work in Wilmington and Philadelphia, and next year we're moving to Baltimore. This is the nature of the modern American economy, where you move around to find opportunities, but unless you're a single childless early 20-something it makes the rest of life very logistically complicated. Certainly among my friends, who are getting into their 30's, long-distance relationships are quite common and nobody is really thrilled about them. [1] In comparison, my wife's parents grew up in the same city and went to high school together, less than 50 miles from where her dad's family settled during the wagon trail days.
- tostitos1979 13y ago
  It is interesting to read your comment. Curious if you know married couples who have to be apart and how this affects their marriage? When both husband and wife have specialized jobs, it seems the choices are to compromise on one person's career or too live apart for at least some periods of time.

squozzer 13y ago

A very interesting piece, revealing a cultural side-effect I had not expected. The stereotype we hold in the West about Japan is that conformity is the norm, which for the most part holds. But not in housing it seems. They have my admiration AND sympathy.

snogglethorpe 13y ago
The houses shown are far from typical... :]

ggreer 13y ago

They glossed over one of the biggest reasons houses are demolished after a few decades: earthquakes. Thirty years of earthquakes will ruin any house that's not a bomb shelter.

userulluipeste 13y ago
That's not really a reason. Romania has an active epicenter of earthquakes and the houses are not demolished/rebuilt that often. When designing and constructing buildings, there are also just some seismic requirements, that's all. There isn't any planned obsolescence involved and I haven't heard of much earthquake damage since 1977.
- ggreer 13y ago
  In the past ten years, Japan has had 21 earthquakes of magnitude 6.5 or greater. In the past 100 years, Romania has had 5.
  - andrewcooke 13y ago
    chile doesn't demolish houses like this either. i don't know where you're getting 6.5 mag data, but for 8+ we're very similar to japan - http://earthquake.usgs.gov/earthquakes/eqarchives/year/mag8/magnitude8_1900_date.php http://earthquake.usgs.gov/earthquakes/eqarchives/year/mag8/...
Retric 13y ago
Yet San Francisco is filled with older homes... No, the real reason is the delta between a tiny but valuable home and junk in 30 years is not that high because construction is cheap due to climate and the time value of money eat's what little value might be there. For most people they get most of there value from simply living in the house. PS: US, also spends a lot of our GDP on housing construction we just value the land vs home differently because of cultural reasons and construction materials. Despite the demonstration from the rust belt that it's mostly the land that's valuable not cheap homes. aka location location location

Alexx 13y ago

Fascinating. I had absolutely no idea. As someone who lives in a property that's over 140 years old, which has been fully renovated, modernised, and improved (at a guess) maybe 10 times over its life I find the idea of housing as a disposable assets rather alien. Granted, there are no earthquakes here. I wonder what the social and economic trade off is between maintaining and modernising a building for hundreds of years (considering energy efficiency and standard of living too) vs just knocking it down and building a new one every 30 years. The article doesn't mention the effect this has on the rental market - If the asset depreciates I can't imagine being a landlord is a very lucrative proposition?

fjk 13y ago
"If the asset depreciates I can't imagine being a landlord is a very lucrative proposition" That's not necessarily the case. Traditionally, landlords make money on 1) cash flow from tenant rents and 2) appreciation of the property at the eventual exit. In Japan, it seems like 2) is out of the equation, but if 1) is high enough, owning rental properties could be very lucrative for landlords, especially if there's high demand for rental properties. Detroit is a market that's experiencing an increase in rental properties even though appreciation is practically nothing in most areas.

staunch 13y ago

The brand new apartment I moved into near the center of Tokyo in 2006 is now something like 30% cheaper than it was then. Whereas refinished 1930s era apartments in LA are like 50% more expensive. I absolutely love the constant push to modernize everyone's home. Why shouldn't home technology evolve like any other. Of course it's expensive and wasteful, but so is buying an iPhone 5s.

rayiner 13y ago
> Why shouldn't home technology evolve like any other. Because it doesn't. Home technology evolves so slowly, that the analogous situation in the tech world would be if you could simply upgrade the memory and hard drive on your 286 to be able to use the latest and greatest software.
- blacksmith_tb 13y ago
  Yes and no - the idea of insulating existed 100 years ago, but the materials weren't the greatest (attics full of horsehair, etc.). And the cheapness of fossil fuels made it seem mostly unnecessary. Moving from a drafty 1921 home to a passive house that was built this year, the difference for me was striking. Some of the improvements can be retrofitted onto older homes (PV, blown-in insulation, attic insulation), others, not so much (windows and doors are more painful to replace, e.g.).
  - rayiner 13y ago
    Sure, windows and doors are more difficult to replace, but it's all quite doable, which is striking considering the century that passed in the meantime. It's a testament to how slowly housing technology evolves.
  - masklinn 13y ago
    > the idea of insulating existed 100 years ago, but the materials weren't the greatest (attics full of horsehair, etc.). Mineral wool commercial production started in 1871 in Germany, and asbestos started being used as insulation material in the 1860s in North America.

deleted 13y ago

[deleted]

deleted 13y ago

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nostromo 13y ago

Do building codes & zoning play a role in this? I've seen some crazy structures in the US, including a castle in Northern Idaho, but they tend to be in places with lax building codes (or lax building code enforcement) no HOAs and no urban zoning. Just in the start of the article they mention a few things that we be hard to build legally in the US: handrail-less stairs, rail-less balconies, windowless rooms & houses.

kohsuke 13y ago

A Japanese here. I think this article fell into the same trap that many other similar articles fell into. Namely, in trying to make the article interesting, it attributes more to the culture and psyche, ignoring more mandane logical reasons. One of the primary reasons houses depreciate in value so rapidly in Japan is simply because that is the accounting rules. If you look at http://www1.m-net.ne.jp/k-web/genkasyokyaku/genka-tatemono.htm http://www1.m-net.ne.jp/k-web/genkasyokyaku/genka-tatemono.h... (and I hope Google Translate translates it well), you see that the typical wooden houses (the kinds you see in California, where I live) depreciate competely in just 20 years in the eyes of tax agency. This has real effect on mortgage. The rules around the market are different, too. For example, in California most houses are sold and bought as-is. In Japan, the seller is on the hook for up to an year for problems that weren't discovered at the point of sale. These differences depress the existing house market, and that is made up by the new house market, which in turn translates into a lot more new houses. I find this report from Ministry of Land, Infrastructure, Transport and Tourism highly educational. It comes with lots of numbers: http://www.mlit.go.jp/common/001002572.pdf http://www.mlit.go.jp/common/001002572.pdf more

ChuckMcM 13y ago
Thanks for the links, Google Translate did enough :-) I find this fascinating: "The rules around the market are different, too. For example, in California most houses are sold and bought as-is. In Japan, the seller is on the hook for up to an year for problems that weren't discovered at the point of sale." In California there are many rules, permits, and processes that must be followed before building a new house. This comes from voters (residents) seeking to limit the rate of change in their neighborhood, and restrict change they would find objectionable (like multi-floor houses in a neighbor with all single floor houses). So buying an existing house is always "easier" than building a new one. Buyers are not responsible for any problems that were disclosed at the time of purchase and signed off on by the buyers. The buyer has the option (and should) to get a thorough home inspection prior to the purchase. Contrast that to Las Vegas were my I spent my formative years where new houses were the norm and 'old' houses were depreciating because why buy an 'old' house when a 'new' one was the same price? This continued for a long time and pretty much covered the valley floor there with very similar looking houses. That has slowed some now that land to build on is quite far away from the rest of town. But I could see that tearing down houses on land closer to town and rebuilding them might improve the value of those houses. The bottom line for me is that clearly municipal regulation has a lot more influence on home 'value' than a nominally open market would suggest. I always knew it had a some effect but it seems possible that it is perhaps the dominant effect.

Ashley46 13y ago

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WalterBright 13y ago

It seems a lot like cars in the US, where people regularly discard perfectly good cars and buy new ones. In my extended family, we tend to keep cars for decades, driving them daily. If you keep them maintained (and maintenance is cheap), you can keep them operating just fine for a long time. Heck, my truck is 25 years old, I've had it for 20 years, costs me about $300/yr in maintenance, insurance is cheap (no collision), no worries about somebody stealing or damaging it, and I go out on a frosty morning, turn the key, and it starts right up. I don't feel any urge to replace it with a new one.

TylerE 13y ago
The japanese are even more insane there. Their inspections are insanely expensive, to the point where cars older than 5-6 years have essentially negative value, as the biannual inspection would cost something like $5k. http://followrory.blogspot.com/2013/06/shaken-car-inspection-in-japan.html http://followrory.blogspot.com/2013/06/shaken-car-inspection...
- WalterBright 13y ago
  Other than the absurd "cash for clunkers" program, the government here is fairly friendly to us old car drivers. For example, a couple days ago was the last time I have to have my truck emissions tested. At 25 years of age it drops off the radar. My 40 year old Dodge now qualifies for "collector plates" where, for a one time fee, I never have to pay the annual registration fee again. And, of course, there is quite an industry in the US providing repair/maintenance parts for those old machines for far less money than parts for new cars. It's really quite nice if you like having those cars.
  - TylerE 13y ago
    US regulation is weird. Stuff that is wildly not compliant to modern standards is grandfathered in, while stuff that in many respects meets MORE stringent standards (e.g. anything sold in western europe) can't be registered.

drderidder 13y ago

Avante garde houses like those shown in the article are still very much the exception and not the norm in Japan. It's true that some Japanese architects are pushing the envelope but vernacular housing in Japan today is exemplified by companies like Daikyo, Mitsue, etc and not by these modernist custom designs.

bhewes 13y ago

Actual the fact a house deprecates makes more financial sense then what he have in the US. A house is an expensive durable good. Land is the asset that appreciates. Nothing crazy about separating the two.

mosselman 13y ago

I read 'hosting'.

VexXtreme 13y ago

I live in Japan and I find the housing here completely abysmal. The construction practices are very poor and even if you shell out for an apartment in a new mansion, expect to find paper-thin walls, no heat insulation and overall very shoddy construction quality. In the winter my (fairly new) apartment gets almost as cold as outside and getting up in the morning always requires running the AC for half an hour first. Single pane windows are standard, there is no central heating and walls are hollow and very thin. I can literally hear my neighbor taking a shower every night, and don't get me started on being able to hear passersby on the street all night long, despite the fact that I live pretty high up. This is an absolutely amazing 1st world country with 3rd world construction practices. I blame it on several factors: 1. Cheap and scammy construction companies that try to maximize their profit margin by using cheap materials and poor building practices. 2. People who don't know any better. Most Japanese people assume that what they get is standard and fair. 3. The pervasive Japanese mindset that everything is disposable, replaceable and ephemeral. In Japan, little value is generally placed on long term value of things. The house where I grew up in Europe is built like a castle compared to even some of the best houses I've seen here. If this doesn't sound crazy enough, there are a lot of carbon monoxide related deaths every winter in Japan because many people (especially elderly people) use an ancient heating system called /kotatsu/, where they burn coal under a small table that's covered with a blanket. My girlfriend once got burnt badly because she fell asleep under her kotatsu and accidentally touched the heater. Don't get me started on electric blankets and similar nonsense, which is all over the place.

hoi 13y ago
I also used to live in Japan. Construction has to follow guidelines to ensure they comply to earthquake standards and Japan is one of the leaders in earthquake - proof technology. Part of this may come in the compromise of 'thinner walls'. This in part also explains why tearing down a house and building a new one is desired, as you would want the most modern earthquake proof property. I haven't lived in a place in Japan that wasn't double glazed and central heating is not really required since most of the year heating is not required (at least in Tokyo). Without trying to sound 'patronizing', you sound a bit like a foreigner who hasn't yet fully adapted to Japan.

yetanotherphd 13y ago

"Why Japan/China/Korea does X stupid thing" followed by some orientalist explanation is becoming very common. If you wrote a similar article about an African or Jewish country you would probably lose your job.