If you've ever desired a home in Japan, now may be the perfect time to pack your bags.
Media reports are noting an uptick in the number of homes listed by Japanese government and local municipalities on so-called "akiya banks." In Japanese, akiya means abandoned or vacant properties.
According to recent estimates, Japan is home to an estimated 10 million vacant homes, with many dilapidated structures scattered throughout rural and suburb areas. As detailed in the Japan Times, the Nomura Research Institute projects the number of abandoned dwellings to grow to 21.7 million by 2033, or roughly one-third of all homes. For anyone both handy and looking for a good deal, the opportunities appear to be growing.
"These abandoned homes are toxic assets — they're costly to maintain or to tear down," Munekatsu Ota, head of a vacation rental firm in Japan, told the Japan Times. "But a simple renovation could turn them into moneymakers."
A shrinking population
In June 2018, Japan's Health Ministry announced that only 946,060 babies were born in the country in 2017, the lowest amount since record-keeping first began in 1899. Couple that figure with half a population over the age of 46 and Japan is on track to reduce its numbers to 100 million (from around 127 million today) by 2050 and 85 million by 2100.
The problem, termed a demographic time bomb, is already playing out in supermarkets where the sale of adult diapers is expected to outpace baby diapers by 2020.
"An aging population will mean higher costs for the government, a shortage of pension and social security-type funds, a shortage of people to care for the very aged, slow economic growth, and a shortage of young workers," Mary Brinton, a Harvard sociologist, told Business Insider.
The expanding market for vacant homes is due to both declining population, a shift from rural to urban environments, and even cultural superstition. Should a home have been the site of a suicide, murder, or even what's called a "lonely death," its value on the open market is generally extremely low. For such properties, nature is generally the next tenant to move in.
Turning to immigration
In an effort to boost its younger demographics, shore up its shrinking work force, and resettle regions sprinkled with vacant homes, Japan is loosening its once tightly controlled visa policy and allowing more foreign workers to enter the country.
"Anyone wandering around Japan, from Hokkaido to Tokyo to Okinawa, knows that there is growing diversity in schools and the workplace," Jeff Kingston, a professor at Temple University Japan, told the Nikkei Asian Review. "Employers know just how essential [foreign workers] are and this recognition is spreading. Japan is a new immigration destination ... and more is necessary to boost its future economic prospects."
With plenty of vacancies in the housing market, government officials have been making strides to offer properties from "free," with buyers only paying taxes and fees, to steeply discounted, with some older units selling for only a few hundred dollars.
As you can see from one "vacant home bank," many of these properties need some serious TLC, while others are located in rural regions. Nonetheless, for those interested in breathing life back into abandoned structures, a small investment could reap some big benefits.
"Personally, I think it's not so bad," Katsutoshi Arai, president of the estate agency Katitas, told the Financial Times in 2015. "When I was growing up, what I always heard is that Japan has a huge population, the houses are small, and you won't be able to buy one. Now you can buy a fairly big house for a low cost, refurbish it and live well."