Japan - Houses And Land Prices Falling For 17 Years

[Tired of Waiting]

Japan - Houses and Land prices falling for 17 years, since 1992, to the present. (And are still falling.)

Could it happen here? Why not?

Note that the argument "but Britain is a small crowded island" won't work this time, as Japan is also an island, and even more crowded - with a higher population density.

Charts: Japan, prices of land and housing falling for 17 year, 1992-present.

Source: http://www.globalpropertyguide.com/real-es...-house-prices/J

Note that the left-hand charts shows prices CHANGES, not prices LEVELS.

Left-hand charts shows prices CHANGES, not prices LEVELS.

[200p]

Ah but the Japanese are smaller. We are more overweight to obese, so take up more room. Ergo all about supply and demand.

And don't forget the immigration!

[Tokyo_Expat]

Japan - Houses and Land prices falling for 17 years, since 1992, to the present. (And are still falling.)

Could it happen here? Why not?

Note that the argument "but Britain is a small crowded island" won't work this time, as Japan is also an island, and even more crowded - with a higher population density.

Charts: Japan, prices of land and housing falling for 17 year, 1992-present.

Source: http://www.globalpropertyguide.com/real-es...-house-prices/J

Note that the left-hand charts shows prices CHANGES, not prices LEVELS.

Left-hand charts shows prices CHANGES, not prices LEVELS.

Hmmmm...anywhere nice and convenient is still damned expensive, I can assure you. Nice family homes in Tokyo (detached, garden, 3 bedrooms, close to convenient subway stations) are still 8 to 9 times average incomes, and by average I mean Tokyo average not bumpkin provinces average.

I will admit that complete dumps and places where nobody under the age of 70 wants to live are cheaper though...whoopee, big fvcking deal

Edited September 22, 2009 by Tokyo_Expat

[lurker07]

And remember Britain is OBSESSED with bricks and mortar. Can't go wrong.

[eric pebble]

Did Japan have LIAR LOANS?

[interestrateripoff]

Japan never fixed it's debt bubble.

Prices are more than likely to keep falling in the current climate.

[thecrashingisles]

Hmmmm...anywhere nice and convenient is still damned expensive, I can assure you. Nice family homes in Tokyo (detached, garden, 3 bedrooms, close to convenient subway stations) are still 6 to 7 times average incomes, and by average I mean Tokyo average not bumpkin provinces average.

Try finding such a place in London for 6-7 times average London incomes.

[Confounded]

Japan - Houses and Land prices falling for 17 years, since 1992, to the present. (And are still falling.)

Could it happen here? Why not?

Note that the argument "but Britain is a small crowded island" won't work this time, as Japan is also an island, and even more crowded - with a higher population density.

Charts: Japan, prices of land and housing falling for 17 year, 1992-present.

Source: http://www.globalpropertyguide.com/real-es...-house-prices/J

Note that the left-hand charts shows prices CHANGES, not prices LEVELS.

Left-hand charts shows prices CHANGES, not prices LEVELS.

I always look to Japan as a good case study, 2nd largest economy with high personal saving rates. The Government has had to borrow and borrow to the point where I think this recession (likely depression) will be the last nail for them and despite all this borrowing they were not able to pull themselves out of the liquidity trap. Their market is likely to carry on declining and possibly even accelerate as the reality of their situation become more apparent.

Japan was able to spread the 50% + nominal and real falls over a very extended period while the rest of the world was in boom times. So although I look to Japan as an example of a major economy that has suffered a significant collapse form a land bubble I do not think the UK is destined for the same luck. Ours will be much more painful and over a much shorter period.

[Tokyo_Expat]

Japan never fixed it's debt bubble.

Prices are more than likely to keep falling in the current climate.

The pace of the fall is fvcking glacial, people in their 30s now will all be dead or past caring by the time DECENT houses become affordable again... and the UK is even worse, I'm sick of this shit, wish I could live in America :angry:

[We're all dooomed!!!]

Japan - Houses and Land prices falling for 17 years, since 1992, to the present. (And are still falling.)

Could it happen here? Why not?

Note that the argument "but Britain is a small crowded island" won't work this time, as Japan is also an island, and even more crowded - with a higher population density.

Charts: Japan, prices of land and housing falling for 17 year, 1992-present.

Source: http://www.globalpropertyguide.com/real-es...-house-prices/J

Note that the left-hand charts shows prices CHANGES, not prices LEVELS.

Left-hand charts shows prices CHANGES, not prices LEVELS.

Probably it could happen. The thing is, is it that desirable? A very slow, drawn out crash that is like drawing teeth for all involved? I'd question whether that is desirable in comparison to say 25% off in a year which may be disasterous for some in the short term, but quickly brings affordability back for FTBs. Certainly that would be less frustrating for many of the people on here who are locked out of the market and would remain so for many years in this type of scenario.

[Toto deVeer]

There is a very high probability that this will happen in the UK. This is the net effect of gov't current policies.

In fact, the early shape of the price curve so far is almost identical to that of Japan's. Japan's malaise began with an initial big dip, followed by a recovery to a more slow rate of decline that has persisted for many years since.

If the gov't had not interfered at all, and just let prices reach their true market value, then the correction would have been very sharp, very short, and you could look to a long term recovery of price growth.

But unfortunately you have a very weak gov't in control who are facing an election. The timing couldn't be worse.

[catsick]

your charts are wrong , prices were rising 2004-2008 , in central tokyo minato ku very strongly indeed , in aoyama 5 chome there was a positive bubble in prices , they are all off a bit now but I dont think bad value , quite a lot of my friends in tokyo are buying land and building houses and some of them are very nice places and the mortgage comes in at around half of what the rent would be so its not a terrible position to be in , my flat which I lived in when I was in tokyo i bought for

17% of what the previous guy had paid for it ( yes about 1/6 of the price !! ) I really miss the place )-: ,

[Tokyo_Expat]

Probably it could happen. The thing is, is it that desirable? A very slow, drawn out crash that is like drawing teeth for all involved? I'd question whether that is desirable in comparison to say 25% off in a year which may be disasterous for some in the short term, but quickly brings affordability back for FTBs. Certainly that would be less frustrating for many of the people on here who are locked out of the market and would remain so for many years in this type of scenario.

Well said. I want a quick crash and then I can buy a DECENT house for my family. End of.

[Confounded]

Hmmmm...anywhere nice and convenient is still damned expensive, I can assure you. Nice family homes in Tokyo (detached, garden, 3 bedrooms, close to convenient subway stations) are still 8 to 9 times average incomes, and by average I mean Tokyo average not bumpkin provinces average.

I will admit that complete dumps and places where nobody under the age of 70 wants to live are cheaper though...whoopee, big fvcking deal

Exactly which is why their correction may still have a long way to go yet. I remember seeing a program that examined Tokyo's "crashed" housing market. The flat they showed was $4 million US at the peak and had fallen to $2 million at point of filming and looked very pricy at that, could easily fall another 50% from here making a 75% fall overall. Japan has been able to do all the thinks the UK is trying now with putting props under the market but I do not think with the rest of the World in the condition it is we will have the luxuary to prop things up for as long as they did.

[Sir Sidney Ruff-Diamond]

Exactly which is why their correction may still have a long way to go yet. I remember seeing a program that examined Tokyo's "crashed" housing market. The flat they showed was $4 million US at the peak and had fallen to $2 million at point of filming and looked very pricy at that, could easily fall another 50% from here making a 75% fall overall. Japan has been able to do all the thinks the UK is trying now with putting props under the market but I do not think with the rest of the World in the condition it is we will have the luxuary to prop things up for as long as they did.

Quantitative easing is a crude translation of 金èžé‡çš„ç·©å’Œ (that's pronounced kin'yuu ryouteki kanwa Tokyo_Expat). I know I keep making that point, but it is one worth remembering if you think that the Bank of England's cunning plan to keep house prices in the UK high is anything new. It isn't. In fact, it was partly this measure that prolonged Japan's housing bust and led to the lost decade, which is still where I think we are heading.

Well said. I want a quick crash and then I can buy a DECENT house for my family. End of.

But I thought you were dripping in j-chicks, charisma-man?

[Tired of Waiting]

I do not think the UK is destined for the same luck. Ours will be much more painful and over a much shorter period.

I hope so. I mean, I don't "hope" for the pain part, but as the correction is unavoidable, the sooner the cheaper.

The only possible positive side for the government to try to soften our landing would be to avoid Lloyds and RBS going bust.

(And in this case, this current property buyers, with large deposits, are doing the nation a favour - even if it is more Social Darwinism in action than charity).

BUT, if prices are going up, then the gov. got the dose wrong. We are having over-dose.

[catsick]

the charisma man thing is soooooo true ! I met so many of these guys over the years ....

[Tired of Waiting]

wish I could live in America :angry:

We've been thinking the same here. Serious.

[Greg Bowman]

We've been thinking the same here. Serious.

Well stop wishing.....You will probably find if you have a skill/the drive that gets you into America on an official green card that would deliver a good lifestyle in the UK if it was applied.

Different sky same head.

[Tired of Waiting]

your charts are wrong , prices were rising 2004-2008 , in central tokyo minato ku very strongly indeed , in aoyama 5 chome there was a positive bubble in prices , they are all off a bit now

The chart shows the national average. It is quite possible, normal that individual neighbourhoods will have variations around that average.

[Sir Sidney Ruff-Diamond]

We've been thinking the same here. Serious.

I've been thinking the same - I wish Tokyo_Expat would live in America.

I wish I had a link to the thread he produced when he talked about how he 'earns a six figure salary' (one pound sterling = 230 odd yen!) and that he has women throwing themselves at him and how much in high esteem he is held in the ex-pat community. Priceless.

Tokyo_Expat = Charisma Man

[AteMoose]

remember at the peak Japanese property was ludicrous, after 17 years of falls it is still more expensive than UK property! It could happen in the UK, if the average property UK was 1 million pounds+ at the peak!

“At the peak of the Japanese real estate bubble, the Imperial Palace in Tokyo was worth more than the entire state of Californiaâ€.

is Buckingham palace worth more than the entire state of cali? (clue, nowhere near, Buckingham palace is worth a couple of billion max), london hasnt seen anywhere near the price rises that forced tokyo upwards into the sky.

Edited September 22, 2009 by moosetea

[Tired of Waiting]

I do not think with the rest of the World in the condition it is we will have the luxuary to prop things up for as long as they did.

The danger is the decision process: political-economy. Governments are forced to do what the (average) voter wants. Brown will do his up-most to prop the economy up before the election, regardless of cost. He can afford it, as it is only 6 months.

But what will Cameron do? I don't have the numbers, the "econometrics" of it. I mean, if it will be possible to correct hard and fast, and start a recovery BEFORE the following election, then he will do it. But I'm not sure it is possible. If he tries a hard correction, and it lasts for 5 years or more, then he will lose the following election.

Edited September 22, 2009 by Tired of waiting

[Olebrum]

Ah but the Japanese are smaller. We are more overweight to obese, so take up more room. Ergo all about supply and demand.

And our homes are smaller on average than theirs.

[jp1]

Could it happen here? Why not?

Note that the argument "but Britain is a small crowded island" won't work this time, as Japan is also an island, and even more crowded - with a higher population density.

Why not? - because its different here. Japan may be more "crowded" but the Japanese are generally smaller than us, so it couldn't happen here

+1. Doh! - just spotted the above comment also along my lines of arguement - nice point about obesity too

Edited September 22, 2009 by jp1