
An average family in Tokyo can own a new house for $850/month - jseliger
https://www.curbed.com/2017/2/3/14496248/tokyo-real-estate-affordable-homes
======
codesuki
I think this headline is misleading in 2 ways.

1\. yes you might get a house at this price but it's either 1-2 hours out of
the city center (which is fine, just saying Tokyo is large.) Or alternatively
it's in bad neighborhoods. (bad is relative if you are from the US)

2\. your house will most likely look like this: [https://www.ii-
ie2.net/dat/5ba1164d.jpg](https://www.ii-ie2.net/dat/5ba1164d.jpg)

Sayonara sunlight, hello neighbor.

here are listings:
[https://www.homes.co.jp/smp/kodate/shinchiku/tokyo/list/](https://www.homes.co.jp/smp/kodate/shinchiku/tokyo/list/)

there are nice ones in the list. I am just saying that this is the eastern
country side of Tokyo (check the map) when the title probably makes everyone
think something different.

~~~
wenc
> 2\. your house will most likely look like this

Not sure what's wrong with that? That looks pretty amazing actually. I live in
a unit that looks similar to that near downtown Chicago. My unit is north
facing, and even so, there's more than enough sunlight.

~~~
jessriedel
The title says "house" for a "family", and the pictured structure is not
normally what people think when they hear that, being significantly smaller
than even a typical townhouse. In particular, a "house" suggests something
larger than a small apartment.

Obviously there's nothing wrong with an apartment or microhouse, but it makes
the quoted rent less impressive.

~~~
wenc
Well I guess that’s true from a North American perspective. I’ve lived in
several countries, and from my perspective, in Asia and much of Europe, that
structure seems like it would be considered a passable family home in an urban
area. Most urban folks have a different relationship with space — smaller
spaces are ok if one is close to transit and city amenities.

~~~
jessriedel
But the whole point of the headline is to try and convince the reader that
Tokyo housing prices are low relative to the reader's expectation. If the
small housing price example is congruent with the size of the example house,
there's no story.

~~~
creamyhorror
I'd contend it's fair to adjust for the country's typical expectations. Just
like you couldn't simply expect the same size of house in Hong Kong as you
might in Europe.

~~~
jessriedel
What do you mean fair? This isn't a contest

------
TomMckenny
> The first thing to note is that in Japan, housing isn’t an investment. It’s
> a place to live.

Fixing this can be a major obstacle in countries with inadequate pension
systems. In countries where dependency on rising property values is the chief
or sole form of retirement planing for vast numbers of people, fixing a broken
housing market becomes dependent on fixing the retirement system.

And when land values are consistently propped up by government to a greater
degree than other investments, it moves people even more into land speculation
as their retirement investment because of its artificial safety.

------
SpicyLemonZest
> The first thing to note is that in Japan, housing isn’t an investment. It’s
> a place to live. The country’s slow population growth means that increases
> in property values aren’t guaranteed

I feel like this is a misleading way to put it. Japanese houses _decrease_ in
value, generally quite severely - the conventional wisdom is that after a few
decades you might as well just tear it down and build a new one. So there's
very real option value you're losing in the Japanese model; if you have to
move in a decade or two, you won't be able to get back the equity you put in.

~~~
claudeganon
A big component of this is that building codes aren’t really enforced for the
construction of single-family housing in Japan. Even if you wanted to buy a
used home, you run the risk that shoddy construction could put you at serious
danger in the event of the country’s not-so-infrequent natural disasters. This
is one reason why most people tear down and rebuild.

~~~
heavenlyblue
So people rebuild houses just in case for a not-so-frequent natural disaster?
Or are there other reasons too?

~~~
claudeganon
Yeah there are other reasons, from related insurance concerns to
cultural/quasi-spiritual beliefs that old homes acquire the “fortunes” of
their previous owners. Also, said lack of building code enforcement, makes new
home construction cheaper, faster, and more plentiful.

But there are also A LOT of earthquakes, typhoons, and floods in Japan, so
it’s not exactly a minor concern either, especially when houses are typically
seen as something you buy for life.

~~~
SapporoChris
On the flip side. I have a friend she is native Japanese, divorced, clerical
worker with low income. She got a used house in the suburbs of a small city.
(30 minute bus/walk commute) She basically only paid for the price of the
land. The house itself is in good shape and the only maintenance issues have
been the ones you'd expect from a twenty year old house. Heater replacement, a
kitchen vent. I've been inside the house and I see no evidence of shoddy
construction. (not that I'm trained to spot it).

My point the housing market like it is makes it much less likely for people to
become homeless. Japan's homeless numbers reflect this.

------
gok
This article is citing another article from the same source [1]

"The typical Tokyo metro area starter home would be an apartment (around 750
square feet) or detached wooden house (around 970 square feet) located in the
outer suburbs. According to Zoe Ward of Japan Property Central, the average
Tokyo office worker has about a one-hour commute by train each morning."

So part of the answer is that homes are tiny by American standards, and it's
not actually in Tokyo proper.

[1] [https://www.curbed.com/2016/6/21/11946606/starter-homes-
swed...](https://www.curbed.com/2016/6/21/11946606/starter-homes-sweden-
france-japan)

~~~
SECProto
Even square footage isn't a perfect metric for cross-national comparison. For
example, furniture in Japan (at places like Nitori) is often designed for
smaller spaces. When I lived there, a $300 couch fit[1] perfectly in my living
room, while it would've looked hilariously undersized in any North American
house. I was more comfortable in that apartment, approx 480 sqft, than I was
in a 1000 sqft apartment I had in North America

[1] たとえば [https://www.nitori-
net.jp/ec/product/1141031-1140061s/](https://www.nitori-
net.jp/ec/product/1141031-1140061s/)

~~~
gok
No doubt. American homes don't use floor space very efficiently.

------
soared
The cultural differences make this comparison less meaningful than you’d
expect. In Japan you absolutely never have friends over to your house or
apartment. Everyone meets at bars or restaurants. Similar to nyc, many
apartments in Tokyo are a few hundred square feet and literally only serve as
a place to sleep and shower. That means houses aren’t such a major thing and
so the Japanese invest way less time and energy (and place less importance on)
their homes.

My parents lived in japan and I have a few friends there. I spoke with a
friend who works in graphic design on the outskirts of Tokyo who doesn’t even
own a fridge - all his meals are eaten outside of his home.

~~~
lolcopterpilot
> absolutely never have friends over to your house or apartment

Absolute statements like that are just clearly not true. I've been to Japanese
friends' apartments, even visited friends' family barbecue or wine tasting
night.

Less common doesn't mean it never happens.

~~~
jbay808
I agree. When I lived in Japan, I was invited to (local) friends' places
often, including for a couple of kotatsu sleepover parties. It was probably
more frequent than being invited to a friend's place in Vancouver.

Probably because most of my friends in Vancouver live in sharehouses or
basement suites where they aren't allowed to have guests by their landlord,
while my friends in Japan had small but respectable spaces that they had much
more permissive ownership of.

------
exabrial
You can do the exact same thing in nearly every part of the USA except Blue
cities where regulation has moved home ownership out of the poor's reach. For
example, California, new construction requires an electric vehicle outlet in
garages. If you're poor, you have much better things to be spending $1500 than
some charger outlet they will literally _never use_. Instead, regulations on
how people want to live their lives and shelter themselves cement a cycle of
poverty into these areas.

~~~
defterGoose
Extreme political bias aside, you need to check your facts. This article from
2014 estimates the cost for the required 40/80A breaker/conduit at a whopping
$50. This is in contrast to the higher cost of adding such capability later.

[https://www.greencarreports.com/news/1095076_ca-to-
require-n...](https://www.greencarreports.com/news/1095076_ca-to-require-new-
buildings-to-be-wired-for-electric-car-charging-stations)

------
jbarham
For anyone interested in Japanese house architecture, the book _Jutaku_ ,
published by Phaidon, is fantastic:
[https://au.phaidon.com/store/architecture/jutaku-japanese-
ho...](https://au.phaidon.com/store/architecture/jutaku-japanese-
houses-9780714869629/)

------
api
"But zoning may be the real winner here. Japan’s zoning laws are national—so
no local weirdness hampering construction and driving up prices. The system
has 12 zones progressing from residential to commercial and industrial. Any
buildings allowed in zone 1 are also allowed in the following zones.
Basically: Housing can be built almost anywhere, even on extremely skinny or
odd-sized parcels of land. This increases the amount of usable residential
space and helps builders continue to meet demand, keeping housing costs under
control. "

Fighting for something like this here will be one of the fights of the younger
generations, otherwise they will be permanently locked out in any city with
jobs. (There is plenty of housing where there are no jobs.)

Local NIMBY zoning must die. Its basically a cartel: collusion to restrict
supply and drive prices artificially high.

------
nikkwong
As someone who's invested pretty heavily in real estate over the last few
years (Seattle) I sometimes ponder if we are all eventually destined to a fate
similar to that of Japan's. It seems to me that the US is only a superpower
because we were geographically fortunate to not share contiguous borders with
Europe post WWII and we've taken that for granted. Policy makers in the US
don't have a long enough horizon to adequately plan for the future; and
birthrates are projected to fall—it's hard to say how much, but, eventually,
even below replacement rates (?).

As of late I have started to question the long-term prospect of indefinite
economic growth, and what the implications of challenging the status-quo here
are. I would be interested as to what people's perspectives are around the
likelihood of advanced nations inevitably sharing a fate similar to Japan's.

------
lolcopterpilot
An average family in Tokyo does not live in a detached house so the whole
argument is false. About 27% of the units are detached houses and the ratio is
decreasing a bit.

Plus Tokyo is almost 100km wide. That's a huge area and of course there are
places where housing is dirt cheap because people are fleeing away.

------
turtlebits
I think the more interesting point is the interest rate. 1% @ 35 years is
exceptionally low.

In the US, say at a 3.5% and 30 year loan, your monthly payment would be
closer to $1,350. Add property taxes and insurance, and you are probably
closer to $1,500.

------
jseliger
By contrast consider Conor Dougherty's _Golden Gates: Fighting for Housing in
America_ [https://www.amazon.com/Golden-Gates-Fighting-Housing-
America...](https://www.amazon.com/Golden-Gates-Fighting-Housing-
America/dp/0525560211), which is about how California in particular works hard
to raise the cost of housing.

Places like Seattle are a little better, with an emphasis on "little."
[https://jakeseliger.com/2015/09/24/do-millennials-have-a-
fut...](https://jakeseliger.com/2015/09/24/do-millennials-have-a-future-in-
seattle-do-millennials-have-a-future-in-any-superstar-cities)

~~~
Pfhreak
That said, Seattle has a grass roots effort right now to try and get social
housing on the ballot for November. There are folks here fighting for housing
as a place to live, not as an investment.

------
mcguire
Japan may not be the ideal economic model.

In the 1980s, Japan had an enormous economic bubble. (This was the period when
MITI, the Ministry of International Trade and Industry, was the ultimate
Platonic ideal of how to run a country's economy and the Japanese Fifth
Generation computing project was going to eliminate "programming" as a job
category.) This bubble burst in 1990-1991. It was bad.

" _GDP fell from $5.33 trillion to $4.36 trillion in nominal terms, real wages
fell around 5%,... Many Japanese companies replaced a large part of their
workforce with temporary workers, who had little job security and fewer
benefits. As of 2009, these non-traditional employees made up more than a
third of the labor force. For the wider Japanese workforce, wages have
stagnated. From their peak in 1997, real wages have since fallen around
13%..[as of 2013]._ "

[https://en.wikipedia.org/wiki/Lost_Decade_(Japan)](https://en.wikipedia.org/wiki/Lost_Decade_\(Japan\))

" _Japan 's annual land prices averaged nationwide have finally risen since
the asset bubble collapse, though only mildly at 0.1%, a process that has
taken 26 years to show up statistically._ [undated]

" _By 2004, prime "A" property in Tokyo's financial districts had slumped to
less than 1 percent of its peak, and Tokyo's residential homes were less than
a tenth of their peak,..._

" _The Nikkei 225 at the Tokyo Stock Exchange plunged from a height of 38,915
at the end of December 1989 to 14,309 at the end of August 1992. By 11 March
2003, it plunged to the post-bubble low of 7,862._ "

[https://en.wikipedia.org/wiki/Japanese_asset_price_bubble](https://en.wikipedia.org/wiki/Japanese_asset_price_bubble)

" _After a long climb during the decades of Japan’s economic miracle, prices
exploded in the late eighties in the frenzy of the bubble economy. Over the
following decade, prices collapsed by over 80%, hitting a low in 2002. Since
then however, prices have increased and we are not in the middle of a stable
period of growth with a positive outlook for the future._ "

[https://housingjapan.com/buy/history/](https://housingjapan.com/buy/history/)
[I note: " _Housing Japan is the leading real estate agent for international
clients looking to rent, buy or invest in the Tokyo property market._ "]

" _Tokyo’s property market has had its ups and downs. At the peak of the
bubble in 1989, some condos were selling for more than 1 billion yen, and
buildings with more than 30 floors started springing up._

" _After the bubble, prices plummeted. In 2002, the price per tsubo was about
half that of the bubble era. But easier housing loans and low interest rates
helped spur demand for new condos._ "

[https://asia.nikkei.com/Business/Markets/Property/Tokyo-
prop...](https://asia.nikkei.com/Business/Markets/Property/Tokyo-property-
prices-near-bubble-era-levels) [Has a nice graph of Tokyo condo prices, per-
tsubo (3.3 sq. meters).]

~~~
bsanr2
This needs to be taken within the context of Japan hosting one of the largest
economies in the world, despite being substantially smaller in population than
countries with economies of comparable size; and also in that their real wage
losses 1) pale in comparison to America's, and 2) mean that their real wages
are still much higher than most of the world's.

I've heard it put that Japan's economy makes it relatively easy to live a
stable middle class lifestyle, though almost impossible to accrue substantial
wealth. I understand why this may seem horrifying to some, but looking at the
relative affluence of the average Japanese compared to the average American, I
don't see their situation as particularly dire.

~~~
adventured
> despite being substantially smaller in population than countries with
> economies of comparable size

Which countries would that be? There are very few with economies of comparable
size. The next above Japan is nearly three times larger (China).

Besides, it's super easy to avoid that GDP / population confusion by looking
at GDP per capita.

The US GDP per capita figure ($65,111) for 2019 was 59% higher than Japan
($40,846), which has been tumbling down the per capita rankings for 25 years.

For reference, in 1995 Japan's GDP per capita was $43,440, nearly the highest
of any nation. The inflation adjustment on that is $74,600. So not only is
Japan missing $34,000 just to break even on inflation, by contracting 6% over
that time, they've actually shrank drastically in real terms.

Since 1995 US GDP per capita has increased by about 127% by contrast,
exceeding inflation by about $15,000.

The other legitimate comparables: Germany is ~15% higher per capita, Britain
and France are nearly the same (only slightly higher than Japan). In 1995
Japan had a GDP per capita 100% higher than Britain, now they're even. Japan
ranks #19 on GDP per capita (excluding tiny nations like Luxembourg).

> and also in that their real wage losses 1) pale in comparison to America's,
> and 2) mean that their real wages are still much higher than most of the
> world's.

That's not even remotely close to being true. The US has outperformed Japan
dramatically on both GDP per capita and incomes. At the end of 2019, real US
wages (both median and average) were at new all-time highs, according to the
Federal Reserve. The full-time median income in the US hit near $50,000 for
2019, Japan doesn't come close to that.

Japan's peak on real incomes was hit 25 years ago. They've lost about 1/3 of
their real personal income since then.

Japan went from having one of the highest income figures, to struggling to
remain in the top 20. US wages remain among the highest of any nation
(including on disposable incomes), comparable only to countries like Sweden,
Switzerland, Denmark and Norway.

Here are the average wages in the OECD. Japan ranks about 10% below the OECD
average. The US is dramatically higher, ranking just behind Switzerland.

[https://data.oecd.org/earnwage/average-
wages.htm](https://data.oecd.org/earnwage/average-wages.htm)

Here is the OECD better life index page on incomes:

[http://www.oecdbetterlifeindex.org/topics/income/](http://www.oecdbetterlifeindex.org/topics/income/)

Japan ranks in the middle of the pack, the US ranks at the front of the pack.

Here is the Wikipedia page on median incomes:

[https://en.wikipedia.org/wiki/Median_income](https://en.wikipedia.org/wiki/Median_income)

Japan again ranks well behind the US, and on disposable income ranks
dramatically far behind the US.

More:

[https://en.wikipedia.org/wiki/List_of_countries_by_average_w...](https://en.wikipedia.org/wiki/List_of_countries_by_average_wage)

[https://en.wikipedia.org/wiki/Disposable_household_and_per_c...](https://en.wikipedia.org/wiki/Disposable_household_and_per_capita_income)

~~~
bsanr2
Yes, China and the US, which are both substantially larger in population.
Japan also outperforms most countries that outsize it in terms of population.

>Besides, it's super easy to avoid that GDP / population confusion by looking
at GDP per capita.

Not so much. A high GDP per capita is a poor measure of the average person's
economic wellbeing on its own. Looking at it within the context of measures of
economic inequality helps to mitigate the misconceptions that could otherwise
arise.

For example, according to this Wikipedia article and its cited sources [1],
Japan's rich/poor 10% average income ratio is 4.5. Compare to America, whose
18.5 is much closer to China's 21.6, and far away from France's 9.1 and
Germany's 6.9.

What this means is that America's GDP per capita is substantially more
affected by the high incomes of the highest earners than Japan's. In other
words, the average American sees less of the benefits of that high GDP per
capita than the average Japanese sees of their somewhat lower GDP per capita.

That's just income. Japan's wealth GINI indicates substantially more equality
in that regard than for America. [2]

>At the end of 2019, real US wages (both median and average) were at new all-
time highs, according to the Federal Reserve.

I'd like to see that citation. It's well-known that most wages for Americans,
indexed against GDP, have fallen or remained flat since the 70s. The vast
majority of the income gains have accumulated in the hands of the upper 2
quintiles. This is especially troublesome for Americans as (re: the subject of
this comment section) the housing situation in Japan differs greatly from
America's skyrocketing housing values in major metro areas; medical insurance
and care in America is substantially more expensive; and the cost and quality
of education is higher and less stable, respectively, in America than in
Japan. This is today, after our respective economic histories over the past
few decades.

What your numbers suggest is that Japan was very wealthy for a limited period
of time and is now regressing towards the mean that would be suggested by
their population size and level of development. However, the character of
their economic and institutional policy is making this decline smoother and
more comfortable than anything we're likely to see. I continue to hold that
this is preferable.

1 -
[https://en.m.wikipedia.org/wiki/List_of_countries_by_income_...](https://en.m.wikipedia.org/wiki/List_of_countries_by_income_equality)
2 -
[https://en.wikipedia.org/wiki/List_of_countries_by_wealth_eq...](https://en.wikipedia.org/wiki/List_of_countries_by_wealth_equality)

~~~
mcguire
Real Median Household Income in the United States

Highpoints:

2018: 63179

2007: 60985

1999: 61576

1989: 56678

[https://fred.stlouisfed.org/series/MEHOINUSA672N](https://fred.stlouisfed.org/series/MEHOINUSA672N)

P.S. GDP in constant dollars since 1985: Japan, US, EU, and the OECD
countries.

[https://data.worldbank.org/indicator/NY.GDP.MKTP.KD?end=2018...](https://data.worldbank.org/indicator/NY.GDP.MKTP.KD?end=2018&locations=JP-
US-EU-OE&start=1985&view=chart)

~~~
bsanr2
No one is arguing that Japan's economy has grown more than others. The
reliance on GDP-based data (obfuscates inequality) and household income data
(Japanese and American households do not send both parents to work at an equal
rate) fails to capture the relative fortunes of our country's middle classes.

This is also concerning:

>Thus, use caution when comparing median incomes above $12,000 for people or
$18,000 for families and households for different years

------
bane
Decent family houses in Tokyo are definitely more expensive than this, but not
hugely (also Kyoto surprisingly). There's some interesting things about the
Japanese housing market, for example, many homes become "worthless" after the
end of the mortgage -- so they depreciate and are more like buying cars.

Tokyo is also an absolutely enormous city with even more massive metro area.
There's very few examples on the planet that come close. Tokyo is sometimes
called "the infinite city" for good reason. This means that yes, you can pay
huge money for a coffin in some areas, and little money for an entire house
elsewhere in the same city. New York is kind of the same way in that respect,
but is actually still smaller and less diverse.

I could write a ton more, but I think this series from "Life Where I'm From"
which is pointed out in the article is a fantastic overview of housing for a
nuclear family in Tokyo.

How an Average Family in Tokyo Can Buy a New Home -
[https://youtu.be/iGbC5j4pG9w](https://youtu.be/iGbC5j4pG9w)

Brand New Japanese House Tour -
[https://youtu.be/Jv6SbFlZMbU](https://youtu.be/Jv6SbFlZMbU)

Are Japanese Homes Really Worthless After 30 Years? -
[https://youtu.be/1SiPGP_BDS4](https://youtu.be/1SiPGP_BDS4)

Old Japanese Apartment vs. New House -
[https://youtu.be/SI3_PJoAa04](https://youtu.be/SI3_PJoAa04)

What a Very Old Japanese House is Like -
[https://youtu.be/r8zECc4JM1Y](https://youtu.be/r8zECc4JM1Y)

Living in Traditional Japanese Townhouses: Kyo-machiya -
[https://youtu.be/NljSnaZ2WiY](https://youtu.be/NljSnaZ2WiY)

Checking Out New Japanese House Design and Technology -
[https://youtu.be/5AiLSyNhEXg](https://youtu.be/5AiLSyNhEXg)

I'd also point out this young couple who are expecting their first child
(Paolo from Tokyo)

What a Japanese Moving Company in Tokyo is like -
[https://youtu.be/q0RX59G2jaA](https://youtu.be/q0RX59G2jaA)

$1500 Japanese Apartment Tour in Tokyo Shibuya -
[https://youtu.be/Qtc_zrpRIs8](https://youtu.be/Qtc_zrpRIs8)

Average Daily Living Cost in Tokyo Japan -
[https://youtu.be/xrgrBJc-64c](https://youtu.be/xrgrBJc-64c)

------
claudeganon
Zoning is important, but let’s also remember that single-family housing isn’t
really a speculative investment vehicle in Japan like it is here.

You can either have private equity buying up foreclosed homes and house
flipping tv shows or housing being used as housing that most people can
afford. America chooses the former, Japan, the latter.

~~~
twblalock
> You can either have private equity buying up foreclosed homes and house
> flipping tv shows or housing being used as housing that most people can
> afford. America chooses the former, Japan, the latter.

Even in very expensive markets like Silicon Valley, foreclosures are typically
less than 1% of total home sales.

Homes are not a speculative investment either. Recent studies have shown
investing in housing to be safer than investing in stocks, but with similar
returns, over a time period stretching back to 1870:
[https://marginalrevolution.com/marginalrevolution/2019/03/th...](https://marginalrevolution.com/marginalrevolution/2019/03/the-
case-for-real-estate-as-investment.html)

~~~
danielscrubs
If the housing prices are growing by 6.7% year by year, and inflation is
around 2%, younglings without parents money will have to be priced out and
have to work ~5% harder every year which sounds fun /s ;)

I've earned a lot on owning a home, and even have friends who "earn" more per
year in owning the home than their salary for a particular year.

