Land tax loophole ensures unused, dilapidated firetraps stay standing, till they fall

Abandoned homes a growing menace

by Tomoko Otake

Staff Writer

Shinichi Ueda points to a two-story house standing on 7-meter-tall concrete blocks, flanked by other elevated dwellings. Built on a slope, the wooden structure — part of a 1,000-unit-plus residential area developed in the late 1970s in the suburban city of Tokorozawa, Saitama Prefecture — has been vacant for three years.

Cracks run across its yellowish-brown walls. A plastic bag full of trash sits abandoned in the small weed-choked garden. The windows and screen doors on the first floor have come off their frames, letting in the wind and rain. Inside, the squeaky, uneven floor looks ready to cave in.

Ueda, secretary-general of the Tokorozawa-based nonprofit group Akiya Akichi Kanri Senta (Vacant Home and Land Management Center), says that since September his group has been entrusted by the owner, who lives in Tokyo, to check the property and report back to him. A sign tells people to direct any complaints or concerns to the NPO — to help the owner deal with the neighbors.

As Japan’s population ages and shrinks, run-down, uninhabited properties like this are becoming more common. As of 2008, the most recent year for which statistics are available, there were 7.57 million vacant homes, or 13.1 percent of all houses in Japan, up from 3.94 million in 1988 and 5.76 million in 1998, according to the Internal Affairs and Communications Ministry. The rate is expected to rise to 23.7 percent in 2028.

While these figures include second homes and properties waiting to be rented out or sold, more than a third of the 7.57 million vacant homes in 2008 were categorized as properties left unattended by owners or whose owners have died and are not taken care of at all. Many of these properties are now causing problems in their communities, experts say. As the structures age, the risk of collapse and fire increases. Some have leaked wastewater, damaging neighboring properties. They are also a magnet for criminal behavior, such as arson.

Empty homes are increasing as new ones are built. “Japanese people have this penchant for new homes,” says Kimihiro Hino, senior research engineer at the government-affiliated Building Research Institute. “Also, it’s been common practice for farmers to build rental apartments on their farmlands to save on taxes.”

Indeed, the tax system encourages people to build new homes and keep whatever structures they have on their land, no matter how fragile, unsightly and dangerous. Homeowners pay a mere one-sixth of the standard property tax. This means the property tax, a major revenue source for municipalities, shoots up sixfold when a home is demolished.

Aggravating the problem, Hino says, is the fact that many of the 7.57 million homes were hastily built immediately after the war and don’t meet current housing standards. For many, this makes it impossible to build anything new on their land. For example, the Building Standards Law mandates that all houses have access to a street at least 4 meters wide. A recent Internal Affairs and Communications Ministry survey shows that 37 percent of plots on which vacant homes stand have no direct access to a street or the street isn’t wide enough.

Ueda, who set up the NPO with his father, runs a real estate firm in Tokorozawa and manages 37 vacant properties in and around the city. He says that grown-up offspring of suburban homeowners want to live in the city, leaving them with empty houses to look after when their parents die. Also, empty houses are often fought over by family members, who then tend to postpone deciding whether to put the properties up for rent or sell them off.

“Many people don’t know who to consult about these issues,” Ueda says, noting that they need someone with knowledge of real estate management, tax law and even the Civil Code to advise them.

He adds that while the NPO — the first of its kind in the nation — itself is not a profit-making entity, the group refers cases to the real estate company run by Ueda’s father when owners of the properties decide to take action. Many of the cases that the NPO handles come through referrals from the Tokorozawa Municipal Government, he says.

In October 2010, Tokorozawa introduced the nation’s first ordinance specifically targeting vacant homes, in response to mounting calls from residents worried or angry about the problems they cause. The ordinance spells out the owners’ responsibility to properly manage their properties and allows the city to order them to improve the situation — and publicize their names if they don’t.

Other municipalities have quickly followed suit. According to a survey by the Ministry of Land, Infrastructure, Transport and Tourism, as of last April, 211 municipalities have enacted ordinances that allow them to take a hard-line approach to owners of abandoned houses.

Some municipalities have stepped up efforts to recycle the properties as community centers and day care facilities for the elderly. Others, like Adachi Ward in Tokyo, have focused on getting owners to agree to tear homes down on the grounds that they’re not only eyesores but can threaten the safety of area residents.

In November 2011, Adachi Ward introduced an ordinance on “run-down” houses, covering not only vacant homes but those whose conditions have worsened to the extent there is a serious chance of collapse or fire. Official Haruyuki Yoshihara says the ward got serious after the walls of a two-story building more than 30 years old collapsed on a windy day in March 2010, leaving shattered tiles all over the pavement.

Though no one was hurt because it happened early in the morning, it was enough to prompt the ward office to do something, Yoshihara says.

“There are many houses, not just vacant ones, but ones in which people still live, that have long been left to deteriorate to a degree that they pose a danger to other people,” he said, noting that the number of homes in a “dangerous” condition went up after the Great East Japan Earthquake of 2011.

Through inspections, the ward has singled out 2,133 houses as being “worn out,” of which 427 are considered particularly dangerous. Based on the ordinance, the ward is offering property owners a subsidy of up to ¥1 million to cover demolition costs.

As a long-term solution, however, Yoshihara says the government should do more to support the market for older homes.

And even more fundamentally, people shouldn’t let unused properties remain idle, says Ueda of the Tokorozawa NPO.

The abandoned house in Tokorozawa continues to deteriorate and is no longer habitable, he said, noting that even the city declined to accept it as a donation by the owner.

“We would like to start holding seminars at nursing homes and other places, telling the elderly property owners to liquidate their homes before they die and not to leave them behind,” he said. “The most important solution to the problem is not to create new vacant homes.”

  • mangaman

    So, let me get this straight: Ueda runs a government-funded NPO whose purpose is to refer clients to his family’s for-profit business? For real?

  • 6810

    What I love is how Debito spins this as though it is somehow negative. Abandoned, uninhabited properties is great news for those of us not on mega incomes. Once the creep of abandonment that is being felt in the inaka arrives in the cities, it will be cheaper land and buildings for the rest of us.

    Frankly, since I don’t live in or around Tokyo, I can’t wait.