
Japan Shows the Way to Affordable Megacities (2014) - Osiris30
https://nextcity.org/daily/entry/japan-shows-the-way-to-affordable-megacities
======
the_patrick
I went to Tokyo this year and was shocked at how cheap it was compared to
major North American cities. Meals like ramen were $8.00 USD including tax and
tip. Asked some young people how much rent was in Tokyo, "very expensive,
young people need their parents help... $1,000 USD per month". Sums it up
there, much cheaper than the US and Canada but salaries are so low it's
expensive for them. My take away is that Japan has a rep for being super
expensive when in fact it's now very cheap for North Americans.

~~~
ekianjo
> Meals like ramen were $8.00 USD including tax and tip

There is no tip in Japan. And 8 USD for Ramen is super expensive, in Kansai
you can get ramen for 5 USD or even less. Ramen should not cost that much
anyway, it's super fast to make and ingredients are super cheap too.

~~~
cylinder
It's $20.50 here in Brooklyn at a small neighborhood place (including tax and
tip)! Ridiculous. I bought a premium instant ramen on Amazon, add my own
meat/egg and it's as good or better.

~~~
xor1
Uhh what kind of places are you going to? And what kind of ramen did you buy?
I consider Shinsengumi to be my minimum acceptable standard for restaurant
ramen here in SoCal (I think there's plenty of better places here, but it's
still good), and I don't even know how you could prepare instant ramen that
was comparable even if you had comparable noodles, since the broth takes hours
to prepare.

~~~
cylinder
I'm not a ramen connoisseur but to have this kind of ramen at home is a treat.
I sometimes add mushrooms, garlic, chilis to broth.

Nongshim Shin Black Noodle Soup, Spicy, 4.58 (Pack of 10)
[https://www.amazon.com/dp/B017IRZLKQ/ref=cm_sw_r_cp_apap_nz6...](https://www.amazon.com/dp/B017IRZLKQ/ref=cm_sw_r_cp_apap_nz6qIikbnKhMn)

Theoretically there's no reason why a quality broth can't be reduced to powder
form and used with instant ramen.

~~~
CydeWeys
That's my favorite store-bought brand too, but it still pales in comparison to
fresh ramen at a good shop.

> Theoretically there's no reason why a quality broth can't be reduced to
> powder form and used with instant ramen.

I mean .. there really are. There are all sorts of aromatics and fats that
can't be properly powderized. Note that, e.g., coffee is way better in fresh
form than powder form, as are a huge multitude of foods.

~~~
panzer_wyrm
Press it in osmosis membrane and ship it in a can.

~~~
CydeWeys
Food doesn't work like that. There are plenty of foods that taste
substantially different after sitting for just 15 minutes, let alone packaged
and let sit at room temperature for months. Ramen is a very aromatic broth; it
will not taste the same after months.

------
jorblumesea
Density. Most Americans and American cities refuse to increase density to the
proper levels because there is a "suburbs" culture here. Everyone wants 2 car
garage, large lawn etc. Living in an apartment for your entire life is looked
down upon, especially if you have a family. We're still in the suburbs mindset
as historically space has been extremely abundant.

~~~
TheAdamAndChe
I'm a young person, and to me it's more of an inequality problem than
anything. Only poor people live in apartments, meaning apartment complexes are
poverty- and crime-riddled. Either that, or they are so expensive, it would be
cheaper to get a house. At least in the suburbs with a mortgage, I am able to
build equity.

My experience is in a city that has not been positively affected by
globalization. I know the housing market is quite different in the tech hubs
of the country.

~~~
mjfl
I think if given the opportunity, most people would move to a place where they
have a shorter commute, which is one of the most consistent indicators of life
satisfaction, on par with having a happy marriage. The problem is that you can
only afford to live in a city if you are poor enough to be subsidized or rich
enough to afford to subsidize everyone else. The middle gets cut out.

~~~
brut
Maybe there's a way to get the best of both worlds? High density with space? I
don't know much about civil engineering, architecture and urban planning but
I'm absolutely certain the the current state is just a local minimum, _not_ an
optimal solution. I'm pretty sure we could optimize for higher density,
shorter commute _and_ larger living spaces if we wanted to.

~~~
mjfl
You just need family-size non-luxury apartments to buy (and not rent). The
only apartments of that size in any city that I know cost in the millions per
unit. That's simply out of reach for your local dentist or pizza shop owner
with a wife and 3 kids.

~~~
crazy2be
Out of reach for your local dentist? Huh? Dentists make more than most people
here, $159k/yr average[1]. Software developers make a little over half that on
average, depending on which sub occupation they work in. [2].

[1]
[https://www.bls.gov/ooh/healthcare/dentists.htm](https://www.bls.gov/ooh/healthcare/dentists.htm)
[2] [https://www.bls.gov/ooh/computer-and-information-
technology/...](https://www.bls.gov/ooh/computer-and-information-
technology/mobile/home.htm)

~~~
VLM
Dentists already have a mortgage sized student loan payment to make.

People also confuse revenue with profit. My coworker's OB/GYN has great
revenue, but her insurance costs are amazing, almost as much as my salary.

From memory of my kids birth the hospital direct bills expensive equipment,
certainly my buddies wife did not personally fund the construction of the
birthing center room, however if my dentist wants a new x-ray or new chair
AFAIK its literally cash out of his checking account.

Its comparing apples and oranges. Much like comparing U3 employment stats in
an employee culture like the USA where as in Japan I understand they hire once
a year for new grads and if you don't make it into a real job at a real
company (and very many don't) its a lifetime of either NEET or temp work, so
their concept of U3 means very little compared to our concept of U3. Their
concept of U3 is kind of like our concept of U3 of military service academy
recent officer graduates.

------
pcurve
"The median price for a home in Tokyo and its surrounding three prefectures is
28 million yen, or around $270,000."

Just fyi, if you only include Tokyo, price nearly doubles. It doesn't make the
best comparison because Tokyo + 3 prefecture = 38 million people with over
5000 square miles.

However, that chart alone is very compelling because it shows something that
you don't see anywhere else; declining housing price.

Is centralized and lax housing regulations the main reason for this? I don't
think the author makes a strong argument, but it's certainly a contributing
reason.

~~~
mc32
It also helps when houses are being depopulated because people are aging out
of houses.

There used to be an Australian guy who went around buying and fixing
undervalued houses in Japan. While out in his searches, he'd point out the
many unoccupied houses.

As an aside, when is Japan going to reconsider how it calculates unemployment?
As it is, their unemployment is like 3.7% yet many many younger people work
for as temps, which is sort of counterintuitive for a very tight labor market.

~~~
mdorazio
And yet that's the same way the US calculates unemployment for U3 (the most
commonly reported rate), leading to the same misrepresentation of the actual
unemployment situation.

~~~
hudibras
U3 is standard precisely so that we can compare differences between countries.
If people don't like what it's measuring, then they can certainly use one of
the other metrics like U4, U5, or U6.

~~~
mdorazio
I don't have a problem with U3 at all. I have a problem with it being used as
the de facto measure of employment health in the media when it tells only a
small part of the story for average workers. You typically have to search for
U6 yourself, while U3 is reported by the press every month.

~~~
nradov
Yes if you want to be a well informed citizen you have to mostly ignore the
mainstream media and actively seek out alternative sources. That shouldn't be
a surprise to anyone here.

------
bane
When I was young I remember reading about "Tokyo, the city of $11 hot
dogs"...this was when a normal hot dog in the states was a buck or two.

I never really stopped to figure that maybe it was just foreign stuff that was
crazy expensive. One of the really eye opening things I've learned in the last
few years is how relatively affordable housing can be...even within the Tokyo
city limits.
[https://www.youtube.com/watch?v=iGbC5j4pG9w](https://www.youtube.com/watch?v=iGbC5j4pG9w)
\-- older homes can be much much cheaper.

Here's a $1600/mo house
[https://www.youtube.com/watch?v=As2XMhqNBx8](https://www.youtube.com/watch?v=As2XMhqNBx8)

This needs to be considered against local incomes of course, so they're a bit
less tempting to locals than to American foreigners from ultra expensive
coastal cities.

Part of this seems to be the particular Japanese combination of the shrinking
and aging population + continued attempts at maintaining GDP via construction
works + cultural preference for new living arrangements instead of old
construction. But like anyplace, you pay for where you live and there are
certainly incredibly expensive places to live.

Outside of living arrangements, public transport, food, clothes, and so
on...everything except for personal vehicles is relatively affordable on a
foreigner's salary.

However, salaries in Japan are surprisingly (sometimes shockingly low). I
think I've heard that a person working in a regular "salaryman" job can expect
to earn around their age * 10,000 USD. So if you're 30, you'll make around
$30k USD. This information is a bit old, so expect it to be a little higher,
but this table [1] from 2014 suggests a 32.4 year old computer programmer
makes an average of 4,256,000 yen per year..or about $38k. Some occupations
can make significantly more...but it's interesting to find yourself on this
table and consider it.

1 -
[http://nbakki.hatenablog.com/entry/Annual_Salary_by_Occupati...](http://nbakki.hatenablog.com/entry/Annual_Salary_by_Occupation)

~~~
chrischen
Japan is much more income equal than the US, so a proper comparison would be
of average salary.

In the US a Google engineer can be making $160k while a teacher in some
southern state could be making $50k.

~~~
TheAdamAndChe
Just so you know, it's worse than you think. Teachers in rural MO make
~$35k/yr.

~~~
VLM
And depending how much you trust your numbers there are ten public school
teachers in Mississippi for every google engineer. And there's almost fifty
more states full of teachers... And they'll owe roughly the same student loan
balance at graduation, well, in theory they would, if not correcting for
extreme lack of diversity at Google.

------
barking
Sorry for being a bit OT but you may remember last year a boy was missing for
several days in a remote forest region of Japan. I found that surprising, my
prejudice of Japan had been that it was very heavily populated and urbanised
but when I looked it up I discovered that it is an incredibly forested country
with 70% of the country this way. Practically twice that of the USA.

~~~
ghaff
>Practically twice that of the USA.

That's a bit deceptive though because the US has huge tracts of wilderness
land that aren't forested; they're deserts, tundra, plains, etc.

~~~
barking
That is true but even so it was the complete opposite of what I would have
expected given Japan's large population and relatively small size.

------
Razengan
What never fails to amaze is how Tokyo, for being the world's most populous
and largest city according to a number of metrics, is so _clean_ and _orderly_
, not to mention safe.

Just watch any of the street tours and stroll-throughs on YouTube [0][1][2].
There is almost a serene quality despite the crowds, and so very _far_ from
the dystopian "cyberpunk" vision that we've been taught to expect from
"megacities."

[0]
[https://www.youtube.com/watch?v=RnTvMbeXtqw](https://www.youtube.com/watch?v=RnTvMbeXtqw)

[1]
[https://www.youtube.com/watch?v=95GlwrqE44U](https://www.youtube.com/watch?v=95GlwrqE44U)

[2] [https://www.youtube.com/watch?v=Fy4GX-
YbmmU](https://www.youtube.com/watch?v=Fy4GX-YbmmU)

------
didip
This guy documents his process of moving to Tokyo and buying a house there.
Pretty insightful.
[https://www.youtube.com/watch?v=iGbC5j4pG9w](https://www.youtube.com/watch?v=iGbC5j4pG9w)

------
abalone
This article from 2014 has problems. In 2016 Tokyo:

"Existing condominium units’ average prices rose by 3.73%... New condominium
units’ average prices skyrocketed by 21.2%..."

"...last year was particularly bad for housing starts in Tokyo Metropolitan
Area, with 9.9% less new condominiums (40,449 units) being put on the market –
the lowest level since 2010..." [1]

Basically the article has a politicized tone, comes from an urbanism advocacy
group, ignores the recession, ignores Abenomics, misrepresents the true
fluctuation of the real estate market in urban centers, jumps straight to
"regulation" as the culprit, and is strikingly dismissive of environmental
concerns.

[1] [https://www.globalpropertyguide.com/Asia/Japan/Price-
History](https://www.globalpropertyguide.com/Asia/Japan/Price-History)

------
rdl
It seems like there should be an arbitrage opportunity here, doing some kind
of development in Japan vs. the US. The problem is for hardware it seems to
make more sense to go even farther to China (where all the manufacturing is,
anyway).

------
mberning
It's a cultural thing. They do the same with cars. It is very common to find
engines and transmissions with 60k km on them available for import into the US
at bargain prices.

~~~
VLM
I don't know about Japanese house inspection culture, but their car inspection
system is designed to keep only new cars on the road. Essentially a stealth
tax to discourage driving. So if your car fails inspection, which costs about
$1000 just to attempt, you may as well part it out to Americans and buy
another car...

[https://en.wikipedia.org/wiki/Motor-
vehicle_inspection_(Japa...](https://en.wikipedia.org/wiki/Motor-
vehicle_inspection_\(Japan\))

Its possible given that Japanese don't like used houses that something similar
exists for purchase of a used house, perhaps an inspection that costs $25K
would discourage used house purchases.

~~~
jackcosgrove
The inspection system would also seem to encourage more manufacturing, as a
sort of legally enforced planned obsolescence.

------
contingencies
The article attempts to claim that Japanese policymaking is somehow
responsible for low prices. Correlation is not causation. For example one
could posit that Japan is affordable precisely because nobody has any money,
because their economy has been stagnant for two decades and against an aging
population and reduced investment in critical technology such as industrial
robotics it shows every sign of remaining so. Perhaps for many hope has left
the building and with the absence of meaning life has become a rinse-and-
repeat ritual of careful commuting.

------
mcguire
Keep in mind that Japan has had some economic...difficulties...in the last 30
years, following a massive asset bubble in the late '80s.

[https://en.m.wikipedia.org/wiki/Lost_Decade_%28Japan%29](https://en.m.wikipedia.org/wiki/Lost_Decade_%28Japan%29)

" _...Tokyo [...] is still growing at a rapid clip, despite the fact that
Japan as a whole hit its population peak in 2008._ "

This is probably not sustainable.

------
Street_Bounty
Hopefully we don't need megacities in the future

------
woodandsteel
Perhaps one of the reason rents are so low is the economy of the country has
been stagnant ever since its real estate bubble burst a few decades ago.

------
criddell
Maybe housing in Japan wouldn't be so expensive if they didn't keep knocking
down perfectly good houses to build a new one. It seems like they throw away a
lot of value.

~~~
Inufu
Did you read the article? It's whole argument is that housing in Japan is much
cheaper than other cities.

~~~
cthalupa
Home ownership in Japan is not a permanent thing, however. You build a new
house every 3 decades. This is going to drive the cost down during the time
that you're paying for a house, sure - you use cheaper materials, everything
is build with a short timeframe, etc. But if I buy a house here on a 30 year
loan, at the end of the 30 years, I'm no longer paying that off. It's just
property taxes and upkeep, etc. In Tokyo, at the end of those 30 years I'm
building a new house. I don't ever stop.

There's no point where I go "Yep, mortgage is paid off, I don't plan on ever
moving, or if I do, I can sell this house for enough to pay for another house
that I can just move in to."

Any single month or year might be cheaper, but it still costs a lot more in
the long run to perpetually be paying for your house.

~~~
Aeolun
Only people that buy the plot after someone else moves out build a new house.
It generally retains the exact same house for the durations of someone's life
there.

~~~
cthalupa
While I imagine this is true for some people, the average of houses when torn
down in Japan is 30 years according to their Ministry of Land, and I have
multiple co-workers who have spoken about moving their family in with their or
their spouse's parents while having their home torn down and rebuilt.

------
acd
The Japanese have low birthrate 1.42 per woman.
[https://upload.wikimedia.org/wikipedia/commons/thumb/5/55/Ja...](https://upload.wikimedia.org/wikipedia/commons/thumb/5/55/Japan_Population_by_Age_1920-2010_with_Projection_to_2060.png/800px-
Japan_Population_by_Age_1920-2010_with_Projection_to_2060.png)

The JCB japan central bank started money printing easy money by dumping
interest rate after the last Japanese property bubble.
[https://en.m.wikipedia.org/wiki/Japanese_asset_price_bubble](https://en.m.wikipedia.org/wiki/Japanese_asset_price_bubble)

House prices should be cheap as the population decreases but the house are
already built.

~~~
CydeWeys
Did you read the article? It says that the population of Tokyo has been
growing (despite the country's population slightly decreasing), and also, the
Japanese tend to prefer new construction.

------
timr
They buried the lede (presumably since it was inconvenient to the thesis of
the piece):

 _“Housing is seriously unaffordable in Tokyo-Yokohama, with a 4.4 Average
Multiple (average house price divided by average household income). Osaka-
Kobe-Kyoto has an Average Multiple of 3.5 and is thus rated as moderately
unaffordable. Despite these ratings, Japan has the most affordable housing of
any megacities (over 10,000,000 residents) in the Demographia Survey.”_

If you think real estate in Japan is "affordable", you need only talk to
Japanese people. Salaries here are low, and the economy has been stagnant for
decades. Younger people tend to live with their parents until marriage, and if
you ask them why, they'll tell you: they can't afford to live on their own.

Yes, Construction is rampant, but that's mostly because buildings here are
ripped down every few decades, not because cities are necessarily building
more or larger buildings. There's just tons of churn.

I've said it before, and I'll say it again: if you want affordable cities, a
big part of the "secret" is tanking your economy for a few decades.

~~~
ska
And yet it is much more affordable than, say, San Francisco (9.2) or Vancouver
(10.3) by that same metric, which was their point. By this metric at least,
Tokyo fares far better than comparable cities - no lede buried.

~~~
timr
_" By this metric at least, Tokyo fares far better than comparable cities - no
lede buried."_

But to make that comparison _fair_ , you need to control for a lot of
important factors. I've named a couple of big ones. There are others (like
land area - Tokyo is _huge_. SF and Vancouver are tiny and constrained by
geography.)

This article simply _asserts_ that Tokyo is affordable (which, again, it is
not), and that its "affordability" is due to construction. There's no real
data here that supports that conclusion. It might be "relatively" more
affordable than the frothiest global markets, but SF and Vancouver have been
experiencing much higher population growth over the last decade, and SF in
particular has been ground zero for a massive speculative bubble. The
comparison is apples and oranges.

~~~
ska
You can argue with the conclusions or methods , sure. But to claim that they
buried the lede was just disingenuous.

~~~
timr
The article's thesis is contradicted by the evidence cited by the article
itself: Japan's cities are not "affordable" to the people who live there.

Arguing that Japanese cities are "more affordable" than other, less-affordable
cities is a truism; by definition, every city that is less expensive than
another city is doing something that makes it cheaper. This fact alone
provides no useful information. But some people _really want to believe_ that
Japan's building habits are the answer, and not, say, their 30-year recession,
or sprawl, or any of dozens of other factors.

Perhaps "buried the lede" is not the right phrase for this kind of thing, but
it's still nonsense.

