The enduring stigma of renting

In April, the government decided to extend its subsidy for temporary emergency housing in the Tohoku region by one year. Originally, they allowed for two years, so that means people who are currently approved to live in temporary (kasetsu) housing can remain where they are until at least April 2014. Most of the media coverage of this issue centers on the new housing that was built specifically for the refugees of the March 11 disaster, but in truth most of the units being used for this purpose are existing houses and apartments that the government is leasing from their owners. According to Tokyo Shimbun, in Miyagi Prefecture alone, there are 26,000 minashi–units being rented from landlords–units in use and 21,500 specially built units.

Not everybody was pleased when the government announced the extension. A group of people who own the land on which some of the temporary housing was built expressed concern that they wouldn’t be able to sell their land for another year, and are worried that the government could continue extending the period of habitation indefinitely, which is what happened in Kobe after the Great Hanshin Earthquake. Another dissatisfied group is an association made up of Miyagi realtors and landlords. One would think that landlords would be happy with the extension, since it guarantees income for another year, and probably at inflated rates since the government is paying. However, one Sendai realtor told Tokyo Shimbun that many of the refugees who are living in these minashi units are not homeowners who lost their houses but rather people who were renting apartments or houses that were destroyed or damaged. The realtor says that local governments assigned these renters to minashi dwellings “without properly checking their situations,” meaning, presumably, that the temporary housing program does not discriminate but it should, since there is a difference between renters and owners. Some “adjustment” (merihari) should have been made before the government decided to extend the program another year. Exactly what “adjustment” means in this case isn’t spelled out, but the only natural conclusion is that the renters should be evicted. Read More

That sinking feeling

Tilt: Park City Townhouses in May

It was recently reported that 32 households in the city of Urayasu, Chiba Prefecture, plan to sue Mitsui Fudosan, the company that developed their neighborhood. Urayasu, of course, suffered particularly bad liquefaction during last March’s big earthquake, since most of it is built on landfill. Some of the residents of Park City Townhouse, where homes originally went on sale in 1981, have accused Mitsui of neglect, since their homes were extensively damaged while surrounding neighborhoods, which were built by other developers, experienced much less damage. The plaintiffs are asking for ¥700 million.

Many people in Urayasu have already carried out repairs on their homes, including jacking up building that sunk during the quake. The local government gave up to ¥2 million to each household that suffered damage, but for some homes that isn’t nearly enough. Jacking up a house costs at least ¥10 million. The problem with a place like Park City Townhouse is that all 70 households are supposed to act as one when making a decision, and for months the community was split between repairing and rebuilding. In order to use the large-scale repair fund (shuzenhi), which all the homeowners contribute to on a monthly basis, three-fourths of the residents have to approve. And in order to rebuild the whole neighborhood–which would require a considerable investment from everyone–four-fifths of the residents have to say yes. So far, neither of those proposals have been addressed, but almost half have decided they will file a suit “in solidarity” against Mitsui. Those residents who are not taking part in the suit, according to the weekly magazine Aera, seem to doubt that they could possibly win against such a big company. In addition, some are averse to the publicity, which will do even greater damage to their property values than the quake itself has already done.

Park City Townhouse has always been something a model community. The homes, which originally cost about ¥30 million, retained their value better than most Japanese homes do, up until the quake, that is. Made up completely of two-story townhouses–a style that was popular until land values skyrocketed, thus making multi-story condos more feasible from a financial standpoint–Park City has been used as a backdrop for many movies and TV dramas when producers want to show modern lifestyles. However, the quake revealed what a shoddy job the developer did in preparing the land. Across the street, the predecessor of the semi-public housing corporation UR developed a three-story apartment complex on land that was prepared with a process called sand compaction. (Tokyo Disneyland, which isn’t far away, used the same process, which is why only the parking lot, which didn’t use it, was damaged in the quake) It suffered very little damage in the quake. In Park City, all 70 units were designated hankai (destroyed) to some extent by housing authorities. In addition, large cracks appeared in the ground from which deposits of old garbage such as discarded carpeting–i.e., landfill–come up to the surface. Geologists say that there is no real difference between Park City and the UR complex in terms of potential for ground liquefaction, so the plaintiffs are charging Mitsui with neglect when they prepared the land, and according to Aera’s research other Mitsui developments in other cities suffered liquefaction as well.

Mitsui has said it feels no obligation to pay for repairs or reconstruction, citing the now familiar reason that the earthquake was “beyond what anyone could have expected” (soteigai). Aera points out that the company is very powerful in Urayasu, having helped turn it into one of Tokyo’s most thriving suburbs, and therefore the local government is anxious about taking sides. There are similar suits pending in other neighborhoods throughout the affected areas targeting different developers, but Park City seems to be the one capturing the most attention.

Does ownership = entitlement?

Damages: Worse for some

There was a very interesting letter in today’s Tokyo Shimbun. A 51-year-old company executive from Kodaira, Tokyo, wrote that he recently visited his sales department in Sendai, and one of the employees told him that the residents of the condominium where he lived until the earthquake of Mar. 11 all received “charity donations,” presumably from the Red Cross, totaling ¥450 million, or ¥3 million for each of 150 households. Since the building was declared “zenkai,” or uninhabitable due to the extent of the damage, all the condo owners have had to move. Obviously, thought the executive, ¥3 million is not enough money to replace their apartments.

But what really bothered the letter writer was that he soon learned that other, presumably less deserving victims of the disaster also received donated funds. Another “acquaintance” was given ¥2.5 million. His apartment was also condemned, but it was a rental. The executive said that the person hardly needed that much money, because all he required was “maybe ¥200-300,000 to move to a new rental apartment.” Even more outrageous was the intelligence that someone who lived in a public apartment (koei, meaning that the amount of rent is pegged to the tenant’s income) also received “a lot of money” from the fund. The executive couldn’t understand why, since all that person had to do was “move to another public apartment.” In the end, the letter writer said, “I have doubts that this donated money was spent meaningfully on victims who really needed it, and a lot of people I know in Sendai feel the same way.”

Most of those people are probably home owners themselves, and the letter brings up a matter that has simmered under the surface of disaster coverage for months now: Do home owners deserve more help than other people? Obviously, they think so, but one of the basic tenets of “ownership” is that the thing owned is the owner’s responsibility. He has dominion over that thing and no one can take that away from him. This belief forms the sacred core of capitalism and free enterprise: You can do anything you want with your property, and the unavoidable corollary is that you and only you are responsible for what happens to it.

But ever since the disaster home owners in the affected areas have demanded that the authorities (including TEPCO) help them rebuild, and not just with loans, but with direct payments. In response to the Great Hanshin Earthquake, the government passed the Disaster Relief Act, which provided funds for people affected by natural disasters. Owners of homes assessed to be zenkai can receive up to ¥3 million toward rebuilding. Many homeowners say this is not enough, and there is even a plan for the government to buy up private land along the coast that has become uninhabitable due to changes in the shoreline.

The magnitude of the disaster has, however, obscured an important point. Japan is a capitalist democracy, so why should the government give any free money to home owners? By using tax money to help them, even people who don’t own homes pay to help replace lost private property. This concept violates the spirit of “ownership” and certainly constitutes what libertarians would call a moral hazard.

We don’t necessarily support this view. The lives of people in the stricken areas have been destroyed, and we believe it is a social obligation for all of us to help them get back on their feet, whether through the agency of the government or through charitable concerns like the Red Cross. However, the man who wrote the letter to the Tokyo Shimbun has his priorities twisted. Why is a home owner–who tacitly accepts the risk attendant to ownership–eligible for greater charitable assistance (on top of the money he/she will receive from the government) than is someone who rents? Because he has “lost more”? Perhaps, but loss is an unavoidable component of ownership, so why should a renter be penalized for risking less? It’s a class distinction; no more, no less.

Higher ground

Aobayama Park, overlooking Sendai

The land ministry has decided to monitor real estate transactions in the disaster-affected areas of the Tohoku region. As evacuees start moving out of temporary shelters and rebuilding their lives, many will likely seek new properties on higher ground, thus causing steep appreciation in land prices on elevations considered out of the reach of future tsunami. The ministry, along with the prefectural governments of Iwate, Miyage, and Fukushima, is afraid that real estate companies will try to corner the market on these tracts of land.

The ministry has already asked local governments to gather information about land transactions. The idea is for the local authorities to designate certain choice areas for monitoring purposes based on the Land-use Planning Law, which regulates the buying and selling of properties. Any transactions that take place within the monitored areas will have to be approved by the pertinent prefectural governor before any contracts are concluded in order to preempt deals deemed “improper” by the law. If the governor does not approve the transaction he can have it voided or ask that the terms be changed.

It’s obviously a necessary policy, but it may be difficult to carry out. Local governments are still hashing out whether or not to allow people who own certain low-lying properties to rebuild on the same land. Until they decide, those families are in limbo. Meanwhile, families who have already decided to move to higher ground may be in the process of looking for land and will thus get a jump on everyone else. The competition could end up being fierce, so it will be difficult to judge what constitutes an “improper” deal in some cases if the buyer and the agent come to an agreement. Also, if the local government decides that certain plots of land on lower elevations should be left clear, they will probably have to compensate the owners, something that could take time. And until those families receive their compensation they won’t be able to move. This will be particularly difficult for fishermen and other people in the seafood business, who want to live as close to the sea as possible.

According to the Tokyo Shimbun smaller, more isolated coastal communities aren’t waiting for the government. Some have already started rebuilding. Since tsunamis have been a fact of life in those villages for many centuries, a kind of lore has developed that instructs the villagers where it is safe to build and where it isn’t. After a tsunami, everybody moves to higher ground, and then over the course of decades they slowly work their way closer to the sea, since they’re all fishermen, until the next tsunami hits. It’s an inevitable, tragic cycle.

Make mine menshin

The Asahi Shimbun reports that more and more companies are interested in fortifying their buildings with so-called menshin technology. Menshin involves placing shock absorbers in the foundations to mitigate the vibration accompanying earthquakes. Quite a bit of media attention was directed at the 18-story Sendai MT Building, which not only survived the March 11 earthquake in the largest city of the affected area, but made it through with minimal shaking, according to people who were in the building at the time. Sendaki MT Building is a commercial building run by Mori Trust, and it acted as a kind of makeshift refugee center for office workers who couldn’t get home the night of March 11. Though there were aftershocks all through the night, most people in the building said they didn’t feel them as much as they did in their own office buildings. After the quake, the building’s occupancy rate increased 20 percent and is now almost completely filled.

And it wasn’t just high-rises. The two-story distribution center for Suzuden Logistics in Matsudo is menshin-equipped. None of the goods stored in the building were damaged at all. Another menshin building is the Aizu Central Hospital in Aizu Wakamatsu, Fukushima Prefecture. Though it also underwent 5-plus shaking, the building suffered no damage and regular treatment continued normally. No in-patients had to be moved out or transferred.

The Asahi reports that, while menshin features add between 10 to 20 percent to the cost of construction, major contractors have seen inquiries into the system triple since March 11, and just as many are for factories and warehouses as they are for office buildings.

All fall down

In the months after the March 11 earthquake, a condominium management association conducted a survey of the Tohoku region to find out the damage sustained by multi-resident buildings. Almost all those that were built since 1981, when stricter earthquake-proofing codes went into effect, survived with minimal damage, but there were quite a few built before 1981that didn’t do as well. In fact, the survey found that about 60 structures in Sendai alone had been declared zenkai (“completely damaged”; in other words, legally uninhabitable).

The Asahi Shimbun looked at several of these buildings. One, the somewhat optimistically named Sunny Heights Takasago, was built in 1976 and was actually damaged in 1978 during a large earthquake that struck Sendai. However, the damage wasn’t “complete” and repairs were made. The building was not so lucky this time. The condominium is actually two 14-story buildings positioned in an L-shape. During the initital earthquake the two structures knocked against each other, but afterward inspectors declared them yochui–residents should take caution but they could keep living there. But the condos sustained further damage in the aftershock of April 7: window and door frames deformed, cracks appeared on outside corridors, steel beams were exposed. Even worse, the ground itself was “damaged.” Consequently, the properties were condemned. Read More

High anxiety

You can’t get there from here

Since the earthquake of Mar. 11, I have been extra sensitive to stories of people living in Tokyo high-rises and have expected to see more dispatches like the one I wrote above. Interestingly, they’ve been few and far between, and mostly dwell on how well these high-rises performed during the earthquake. I said as much in my blog post, but that’s not the most salient observation I took away from the experience and I doubt if others who live in tall buildings did as well. Then, last week Asahi Shimbun printed an article relating the experiences of two koso mansion owners. Unfortunately, since then the story is gone from the site, either locked behind a pay wall or taken off completely. I doubt the latter, but M. says she read a few tweets from people who thought Asahi might have been pressured by developers or real estate companies, who are big advertisers. That seems a fairly conspiratorial take on the matter, but one thing’s for sure: New high-rise luxury condos have been one of the few reliable success stories in the Tokyo real estate market in the past few years.

In the article, a 32-year-old full-time housewife was in her 55th floor apartment in Chuo Ward when the quake struck. She ducked under a table. The swaying lasted for a full five minutes. Terrified, she remained under the table during the subsequent aftershocks while she tried to call her husband, a doctor, and the day care center where her two children were. (M.: “She’s a full-time housewife. Why are her two kids in day care?”) She couldn’t get through to either. Read More

Big One

A view to die for

I certainly don’t believe any of that “divine retribution” crap, which happens to unify the philosophies of right wing broadcaster Glenn Beck and Tokyo governor Shintaro Ishihara; but I can appreciate a cosmic joke. The massive earthquake that hit northeast Japan on Mar. 11 came right in the middle of moving season. The Japanese fiscal year, not to mention the school year, begins April 1 or thereabouts, and traditionally many people move house during the month of March, because of job transfers, university admission, or they just like to do what everybody else is doing. Consequently, there were a few trucks outside our 38-story building the weekend after the quake, carrying furniture for folks who were moving in. Fortunately, the freight elevator was operational again by the morning of the 12th, but what did those new arrivals think standing in their new apartment while it swayed back and forth during one of the many aftershocks?

Who knows? Maybe they were in a high-rise before, but in any case the quake helped test a theory, at least partially: Would all these earthquake-proofed structures actually withstand a massive quake? Of course, the epicenter of the one we experienced was a hundred kilometers off the coast of Iwate Prefecture, but according to reports, no buildings collapsed in Sendai, the nearest large city to the quake and one with its own share of skyscrapers. So the technology seems to work, and while it certainly saves lives and property, it doesn’t solve a more intractable problem: Once you’ve been in a large earthquake in a high rise, you don’t want to be in another one. Read More