A glut of unoccupied houses

The number of unoccupied houses throughout Japan keeps growing and is now estimated to have reached a record 8.2 million — or roughly one in every seven houses in this country. With the aging of Japanese society and the decline of its population, the number of such houses — including abandoned properties that pose safety hazards to local communities — is expected to rise further.

The phenomenon is not unique to those parts of Japan experiencing a population exodus to urban areas: It’s also common to major cities. National and local governments are urged to work together to address this urgent problem.

Of the 8.2 million vacant properties nationwide as of last October, about 5 million are either up for rent, waiting to be sold or are kept as second house by owners who live elsewhere. The remaining 3.2 million include properties whose occupants have been absent for a long time and those waiting to be demolished, according to the Internal Affairs and Communications Ministry’s latest survey.

The number of vacant houses has doubled over the past 25 years. Some estimates show that one in every four or five houses in Japan will be unoccupied by around 2030.

Deserted and decaying houses are safety hazards as they become prone to arson, garbage dumping, or illegal occupation by squatters or criminals. Their collapse in times of natural disasters can hamper evacuation and rescue efforts.

The biggest reason for the problem is an oversupply of houses. The government has for years introduced steps to encourage housing construction and purchases — which have wide-ranging ripple effects on other industries — as stimulus measures in times of economic slumps. Since 1968, the total stock of houses has exceeded the number of households. As of last October, the number of housing units hit 60.6 million, far outnumbering the total 52.4 million households.

Also believed to be behind this trend is the emphasis on new houses in Japan’s properties market. Unlike in Western countries where home owners generally try to maintain the value of their houses through repairs, many of Japan’s wooden houses are said to lose much of their value within 20 years after being built. Secondhand properties in bad condition tend to be shunned in the market and may go vacant for a long period without being sold or rented.

As the graying and decline of Japan’s population accelerate, old houses inherited from parents or those vacated after the parents have entered nursing care facilities can prove to be a burden. In rural areas facing depopulation, many properties left by deceased residents are left deserted by their children who have migrated to cities.

In large cities where land prices are high, the fixed-property tax breaks for residential land — reducing the tax rate to one-sixth the normal rate — are believed to discourage people from demolishing their unused houses. The tax breaks, introduced as a means to encourage housing purchases, do not apply if the houses are demolished.

In the face of the growing problem of vacant houses, the government is reportedly considering ending the tax breaks on land occupied by decaying houses deemed unsafe by local authorities, as early as fiscal 2015.

It is important for the government to introduce tax measures that will encourage the owners to demolish such hazardous properties, such as easing the property tax on their land after the houses have been torn down.

Meanwhile, authorities in rural depopulated areas have been taking steps to facilitate the use of unoccupied houses, for example, by creating “vacant-house banks” to provide information about empty properties for people willing to relocate to them so that an influx of new residents will reinvigorate local communities.

There are regional differences in the way houses become vacant, and different approaches may be needed to reduce the number of unoccupied properties. Still, there will be limits to what local authorities can do in response.

The national government is urged to set out a clear policy on what to do about this growing problem — including the continuing oversupply of houses — and to work with relevant parties, including real estate and other related business sectors, in taking effective remedies.

  • boonteetan

    Japan’s lethargic economy, compounded by shrinking population, causes the excessive over-supply of houses. Is it not time to bring in Japanese speaking foreign talents to boost labor force and productivity? A couple of millions of them can easily fill up the empty buildings. Give it a try to make a win-win scenario.