The why of buy

The information magazine publisher Recruit just released the results of its annual condominium purchase survey, which sampled 2,431 respondents who bought condos in the Tokyo metropolitan area in 2008. The two largest age groups represented were 30-34 year olds and 35-39 year olds. The latter demographic was unchanged from 2007, but the former group, which are known in Japan as “post-boomer juniors,” increased by several percentage points, which makes sense since that’s a prime age to buy a first home. However, this figure will likely drop since fewer young people are securing stable employment these days. Read More

Silver linings

After it was revealed in 2005 that many structures built by Huser Construction used false earthquake-proofing data to save on building costs, the company agreed to rebuild the affected structures. Eleven condominiums were rebuilt with subsidies from the central government. Nine have so far been completed, and this month, residents of one of them, the Grand Stage Rivage (formerly the Grand Stage Sumiyoshi) in Koto Ward, Tokyo, will move in. It will be a bittersweet move, to say the least. Read More

Don’t be dense

The government’s disaster prevention commission recently came up with guidelines and measures that it said it would work on in response to major earthquakes that are projected to strike the Chubu and Kinki regions sometimes in the next 70 years. The commission estimated that if an earthquake the magnitude of the one that struck Kobe in 1995 (7.3 magnitude) happened in these two areas, about 42,000 people would die in the Kinki region and about 11,000 in the Chubu region. The Kobe earthquake–or, the Great Hanshin Earthquake, as it’s officially called–claimed 6,434 lives. Read More

Recession proved?

According to a leading real estate research organization, 40,166 new condominiums were put on sale in the Kanto region (Tokyo + the surrounding five prefectures) in 2008, which is about 30% less than the number put on sale in 2007. It was the first time in 16 years that the number of new condominiums dropped below 50,000 units. In addition, the portion of those actually sold was 64.1%, which is about 2.2 percentage points less than the contract rate in 2007. The analysis of this trend isn’t difficult to understand: the recession has put the bite not only on consumers’ buying habits, but also on developers’ ability to build new buildings. However, anyone who has been watching the condo market closely for the last ten years or so has to wonder if some other aspect isn’t being overlooked. Read More

Guest workers with guns

On Apr. 14, about 2,000 residents of Iwakuni, a city in northern Japan that hosts an U.S. Air Force base, demonstrated against a proposed new housing development for American soldiers. In line with a major shift of military personnel, Iwakuni would be receiving about 4,000 soldiers and their families from other bases in Japan, mainly Atsugi. Iwakuni City wants to build about 10,000 new units for these arrivals on Atago mountain, which is mainly why the citizens protested. Atago has cultural and even sacred significance for local people. However, the reasons for choosing Atago go back further than the base issue. Read More

The gift that keeps on

Prime Minister Taro Aso has promised the rest of the world that he will do his best to stimulate Japan’s economy, and one of the ways he plans to do so in the next supplemental budget (¥15 trillion, the highest on record) is to provide a tax exemption for monetary gifts from parents to their children.

Of course, there’s a catch. In order to qualify for the tax exemption, the gift has to be used to either purchase a home or remodel a home. Basically, the idea is that there is some ¥1,400 quadrillion that is not circulating in Japan, but rather just sitting in people’s back accounts or in their mattresses (or, to put in Japanese terms, in the tansu, or wardrobe). About half of this dormant money is in the possession of Japan’s elderly. Normally, when these people die, the money goes to their offspring, who, in turn, just put it into their own back accounts or in their own wardrobes. Since people live quite long in Japan, their children usually are already settled with their own homes when they die. Aso’s scheme is to persuade these older people to give some of their money to their kids (or grandkids) earlier, at the time when they are thinking of buying a home.

The budget has to be passed before this goes into law, and the opposition says it basically subsidizes the rich. But it is sort of half-assed anyway, since the maximum gift that can be tax exempt is ¥6.1 million, and it costs at least ¥20 million to build a halfway decent house in Japan.

Death by city planning

Though this incident isn’t directly related to housing, it has much to do with city planning related to housing and residential areas. On Apr. 8, two 6-year-old girls were run over by a city bus in Kure, Hiroshima prefecture after they had disembarked from the vehicle. One of the girls died and the other remains in serious condition. The 60-year-old driver of the bus has been arrested. Read More