On April 27, the government will launch a new system that will allow people to “return” land they own but don’t want to the state. The main reason for this new procedure is that there has been a marked increase in recent years of land whose ownership is not clear. In 2016, a specially appointed research group found that 4.1 million hectares of land in Japan, an area larger than the island of Kyushu, had no clear titleholders. If this trend continues apace, then by 2040 there will be 7.2 million hectares of unclaimed land. The reason for the increase is that it is assumed that as more land-owners die, a good portion will not have heirs to take over that property. Unmanaged land becomes a problem for the authorities in terms of disaster prevention and general administration, which includes appropriating land for public works and other projects.
There are many reasons why people either abandon property they own or avoid inheriting it from family or relatives. Mostly, it has to do with the cost, including property taxes, of maintaining land and structures that they will never use and can’t sell, especially if they are located in remote areas. Sometimes the property is a rental apartment building that still has a mortgage but no tenants. Sometimes it’s a parent’s home that no one wants to occupy and, again, isn’t sellable for some reason. Then there are forested tracts of land that require management by law, which can be expensive. According to a survey carried out by the land ministry in 2019, 42.3 percent of people who own land or expect to inherit land think that such ownership is a “burden.” This portion goes up when the land is either vacant or zoned for residential use. In addition, 63 percent of unused or vacant land in Japan was inherited by the current owner, a common situation given that land inheritances are taxed at a lower rate than cash inheritances.
So according to land expert Tomohiro Makino, writing in the online edition of Bunshun on Jan. 4, the government’s plan to receive unwanted land starting this April should be good news for many people, but he cautions that it isn’t as easy as just signing over your property. First of all, the system only applies to land, not buildings. If the land has multiple owners or heirs, all must agree to the transfer. Applications are to be made at regional branches of the Ministry of Justice, which will screen them and investigate the plots in question. Also, Makino is keen to point out that it will cost something—the government isn’t going to take land off your hands for free, and you will have to pay up front before the transfer is completed. When Makino wrote the article, apparently the government was still unsure as to how much the transfer would cost, but it is to be determined by how much the government thinks it will cost to manage the land for ten years. Makino thinks it will come to about ¥200,000 per plot, regardless of the size of the plot or zoning category, though the fee for transfering forested land will be determined on a case-by-case basis.
As for conditions, the government will receive land that has no structures on it and which isn’t currently being used as collateral for a debt; land that can be used to generate profits; land for which there are no plans for third-party usage; land whose soil is not contaminated; land that does no contain steep drop-offs, such as cliffs or ravines; land that does not contain “buried objects”; land that is not involved in any legal disputes; and land whose borders are clearly determined. This last condition is particularly tricky because, as we’ve written in the past, there is a great deal of land in Japan whose borders are either disputed or not clear. Such plots, presumably, will not be accepted by the government.
So when looking at the new law it appears that the government is similar to the reluctant heirs in that they don’t want the same type of “crap” properties that the heirs don’t want.
With all the conditions in the law I don’t see that it will change or make any big difference to the situation in Japan.