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quote of the day

Japan has 8 million vacant homes and that is a wasted asset, so we think there’s huge potential for those homes to be used productively to accommodate guests and also for local people to participate in this global tourism industry, particularly older people. We have a lot of seniors on our platform, and they’re actually our fastest-growing host demographic.


Nathan Blecharczyk, Airbnb cofounder and chief strategy officer, saying he sees long-term potential in Japan

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I think many owners of empty homes would rather they stayed that way, than rent them out to foreigners.

9 ( +10 / -1 )

Nathan might not Kinoe this but many abandoned houses are not well-maintained. Many are mere skeletons and others have trees growing in the front rooms etc. However, he might also not know that the Japanese gov’t On all levels sometimes has no idea who owns these abandoned properties.

I believe a wonderful new gov’t Agency needs to be carved out of the public tax trough. It needs to find the owners of these abandoned buildings etc and tax them, get them to sell it or something. Should only take (given the 8 million houses) 100 years or so.

9 ( +9 / -0 )

This is similar to the homeless situation. It's not a question of available space, but a question of property usage rights. This is like saying "there's plenty of money in the world, so nobody should go without."

Except in this case, this utopian dreamer is all about profit.

2 ( +3 / -1 )

People don’t knock them down because the property taxes double. If it’s supposed to be an incentive to sell quickly, it’s a failure as it can take years for a rural lot to sell. Owners don’t want to be stuck with the increased tax bill so they leave the house as long as possible. It costs a minimum of 100,000 dollars to demolish an average sized house and cart it all away, eventually some people choose to abandon the property. Way to go, lawmakers! They should lower taxes if get rid of the decrepit houses.

10 ( +10 / -0 )

I've often thought that for the homes that are still usable, the government could buy them out from the owners and just give them for free to young families as an incentive to having more children. 8 million is a lot.


spot on !

5 ( +6 / -1 )

Most of these abandoned buildings are dangerous even to the insects and wildlife which inhabit them. Most are outside the metro areas in places which are nearly inaccessible to tourists. Lastly, Japan's hotel lobby is all-powerful (being financed by competition-hating Japan Inc's "Mega Banks"). The only reason these millions of buildings still stand is because non-agricultural land with structures is taxed at a lower rate than vacant land.

If you are living in Japan, and have an extra million yen lying in your bank account, you can by a large country home on a large lot. You'll need to put another million or two into it to make it habitable, but for less than the cost of a decent new car, you can have a nice vacation home out in the countryside.

If you have an income, such as a pension, annuity, or other something similar, you can rent a large, subsidized house in a rural area for as little as 10,000 yen per month. The rural areas are desperate for inhabitants.

Had the Japanese government evolved into the 19th century, and allowed people who own their homes to rent them as they please for any term, something might be done with some of these homes. But the old men who run Japan are backward-thinkers.

6 ( +7 / -1 )

Such a waste

3 ( +3 / -0 )

Lower the taxes on vacant lots then abandoned, falling down and dangerous buildings won't be so much of a problem.

3 ( +3 / -0 )

You'll need to put another million or two into it to make it habitable,

id say probably between 3 and 4.5 million is needed to properly remodel a typical country house.

First thing I would do is fill in the crawl space with dirt and put a concrete slab on top for the floor. Insulation, vapor barrier, possibly new wiring and plumbing, maybe even a new waste or septic tank or connecting to the newer city lines(water and waste).

2 ( +2 / -0 )

Fizzbit, and get rid of the asbestos in the kitchen ceiling, for houses that are 40-50 it ears old...

2 ( +2 / -0 )

Yeah, but have you seen them ?

2 ( +2 / -0 )

I think many owners of empty homes would rather they stayed that way, than rent them out to foreigners.

No-one is forcing them to rent them out.

0 ( +0 / -0 )

I wish there was a way I could buy on of these houses and fix it up. I just do not know enough about the process or the cost.

3 ( +3 / -0 )

This guy is hugely uninformed about the state of Japan's vacant properties. It's nice though, to see that elderly Japanese are getting into the hosting business.

0 ( +0 / -0 )

No-one is forcing them to rent them out.

I didn't mean to imply that anyone was.

0 ( +0 / -0 )

Quality control by Airbnb at work here. The guy is suggesting that its worth paying to stay in these places, or that they can be done up cheaply enough by hosts to actually work as extra income?

The easiest way to get a Japanese house in the countryside to work cheaply as a holiday home is to not go there in winter. Renovating an entire house to a level where it is comfortable in winter will cost a lot of money, especially in colder regions in the north or in the mountains. A few million yen will tidy the thing up, and get you a bit of bracing and modern plumbing, but it will still be freezing in winter, even more than a Showa era house. As sangetsu suggests, rather than buying, it is probably cleverer just rent public housing that is going for a nominal rent of 10,000 a month or so in some jurisdiction in desperate need of people. There is no lack of them.

0 ( +0 / -0 )

This quote would not give me any confidence in AirBnB if I were an investor. It shows a number of gross misunderstandings about the Japanese housing market. How many of those 8 million homes are liveable? My guess is only a very small fraction. Most are at least three decades old. They were shoddily constructed from the start, so the homes are typically drafty, poorly insulated, and poorly cooled/heated. Many are well past the point that they should have been condemned. It would take millions of yen per home, sometimes tens of millions, to get these properties back to a basic liveable condition.

Adding to the problem, a high percentage of the homes are in very rural areas. In very few cases are the homes near any popular tourist sites that would make them rentable.

Why is any of this the case? A large number of the homes are vacant because older people have died off. The children may have inherited the land, but they migrated to the city. Rural homes are almost impossible to sell at any price. The homes are left in place because taxes are set higher on vacant lots of land than on land with a building on it. Houses in Japan are built with a mindset that the building loses all of its value after 20 years, and so most home builders don't bother to construct solid homes that could remain desirable even 70 years after completion. Because of the cheap construction and older design styles, old homes can't typically be made desirable even with extensive remodeling.

If the land is in or near a city, a construction company will probably buy the land, especially if the lot is large enough to subdivide it into two lots. The construction company slaps down a new home (or two) after tearing down the old, and it pads the cost of demolition into the construction cost. But in rural areas, hardly anybody is interested in new homes anyway, so the dilapidated properties sit empty. Unless you're looking to build a rural home yourself, these aren't opportunities, and no rental company would dream of touching them. These vacant homes are not opportunities. They're more like dead weights around the necks of many Japanese people--tax burdens on properties that can't be used and can't be sold. AirBnB would be stupid to pursue these properties as rentals. That kind of thinking comes from looking at a single statistic--8 million empty homes--without looking into the details of those homes or the reasons why they sit empty.

1 ( +1 / -0 )

Turning Japan's decrepit housing into AirBnB vacation rentals will not work (see decrepit) ; and even if it did, I would not advise it. AirBnB takes money OUT of a city, region, or country and funnels it to San Francisco, CA, -- The Bay Area, where I live, which should make you stop and think how exploitative and crappy a company AirBnB is sour them on me.

Anyways, my thoughts.

More than half of the empty houses are inherited. In the old days (Up to the 1960s in rural areas, 1980s in urban areas) , they were assets . Now the houses are too old, as pointed out, the tax structure disincentives refurbishing in any but the more affluent neighborhoods, where land is still a very valuable asset.

The vacant house problem is not only caused by tax incentives. That is wrapped into the larger related categories of 1) oversupply of new homes and 2) buyer preference for new homes. If the tax system was tweaked to favor older structures being flipped (spruced up and modernized, and then sold), a good part of the problem would be mitigated. Such house flipping goes on, but not nearly as much as it could. There is much room for expansion.

But, in addition to the oversupply of and buyer preference for new construction, there are the two elephants in the room regarding depressed real estate, and they are the same elephants that impact all economic growth and equity problems in Japan, namely the stable to slightly declining population nationwide and the abandonment of the country side.

I don't know how to fix the latter, but the former is easy:

More babies, more immigration, or a combo of the first two. All else is commentary.

1 ( +1 / -0 )

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