So there’s a ton of countries that I’ve heard have had truly unaffordable housing for decades, like:
- The UK
- Ireland
- The Netherlands
And I’ve heard of a ton of countries where the cost of houses was until recently quite affordable where it’s also started getting worse:
- Germany
- Poland
- Czechia
- Hungary
- The US
- Australia
- Canada
- And I’m sure plenty others
- It seems to be a pan-Western bloc thing. Is the cause in all these countries the same?
- We’ve heard of success stories in cities like Vienna where much of the housing stock is municipally owned – but those cities have had it that way for decades. Would their system alleviate the current crisis if established in the aforementioned countries?
- What specific policies should I be demanding of our politicians to make housing affordable again? Is there any silver bullet? Has any country demonstrably managed to reverse this crisis yet?
It’s mostly supply and demand. In Tokyo and Osaka / satellite cities, prices are going up, everywhere else they are dirt cheap.
However, in urban areas prices still aren’t as crazy unaffordable as you may think, because Japan has a very narrow wage gap (everyone in Japan thinks they are middle class, and their not wrong compared to other countries).
Another thing that makes Japan different to other housing markets, and is affected by the laws, is earthquake concerns. What other countries would call ‘established’ dwellings, they call ‘second hand’. Laws are updated every ten years or so that mean newer dwellings are much safer than older ones. Knockdown/rebuild is so common that there is competitive prices, as there’s plenty of builders to choose from. The builders are also very efficient, and apart from safety law, regulations are low (you can build whatever you like, so long as it’s robust), so labour costs are much lower compared to other countries.
If you go on Suumo.jp you’ll find plenty of very affordable houses, even in good areas/good rail links, but it’s because they don’t expect anyone will live in the house as-is - the buyer will most likely “reform” it (massive rennovation) or replace.
The state of the Japanese housing market is due mostly to cultural/economic/low immigration. If you want a policy solution other high-income countries can use to solve housing issues, the state-capitalism solution of the Singapore HDB is the best model I’ve come across. Second would probably be Vienna’s focus on social housing.
Japan also has a population in decline.
Seems like an important enough factor to mention.
Thank you kind stranger, that was a nice and interesting review!