According to a survey published this week by the Ministry of Internal Affairs and Communications, there were 8.99 million “vacant homes” in Japan in October of last year, an increase of 500,000 from the previous survey (published five years ago), and that accounts for 13.8% of all homes in Japan. Last year, the Nomura Research Institute estimated that the total number of vacant homes will top 23 million — 31.5% of all houses — by 2038 unless large-scale demolition occurs.
Abandoned homes — a subset of those empty dwellings — swelled to 3.85 million, or 5.9% of the total. This is an increase of 360,000 from the previous survey and 80% more than two decades ago. The ministry has projected the figure to reach 4.7 million in 2030. (“Vacant” homes are unused properties such as rentals, vacation homes or those with other purposes; an “abandoned” home has no intended use.)
Empty dwellings pose many dangers. Poorly maintained, they can collapse or fall apart under severe weather conditions and flying tiles, sidings or other pieces of equipment can damage people and structures nearby. Empty houses can be infested with rodents, bugs or other pests, posing health threats. They damage local property values as well.
When apartments or condo units are vacant, they undermine the economics of the entire complex since maintenance and repair depend on fees paid by owners and residents. Empty or unclaimed facilities also diminish tax collection, hurting the cities or regions that need those revenues.
Many but not all of the vacant homes are in rural areas that are slowly depopulating. The prefectures of Wakayama and Tokushima had the highest percentage of vacant homes, each with 21.2%. Yamanashi was close behind, with 20.5%, but that likely reflects its status as a popular place for Tokyo residents to have second homes.
In addition to abandoned or vacant homes, there is an expanding amount of abandoned real estate. In 2016, there were an estimated 4.1 million hectares of unclaimed land — 11% of all the land in the country, an area larger than Kyushu — and that figure is expected to grow to 19%, an area larger than Hokkaido, by 2040.
This, too, has a high cost. In 2016, economic losses resulting from unknown ownership of land reached ¥180 billion, a number that is expected to grow to ¥310 billion per year by 2040. Unchanged, the total accumulated loss of that 23-year period is forecast to reach ¥6 trillion.
The single biggest contributor to this sad state of affairs is a shrinking population. Japan’s population has been declining for 16 consecutive years. If the current trajectory continues, Japan’s population will be cut in half from 124 million in 2023 to 63 million by the turn of the century.
According to one estimate, 59% of these homes became vacant after elderly residents moved out or died. (This percentage will rise as Japan ages and mortality rates increase.) Inheritors are often unwilling or unable to provide upkeep or pay the taxes. Since residential land is taxed at a substantially lower rate than cleared property, there is no incentive to demolish structures.
Buyers are scarce. Japan’s market for existing homes is small. The government estimates that in 2018, less that 15% of housing transactions involved pre-owned houses; in the U.S., by contrast, the figure is 81%.
General population decline, coupled with new construction, means that existing properties don’t get much attention. In 20 years, there will be 4.37 million condos over 40 years old: They are unlikely to get the maintenance they will need for the resale market.
