Why Used Japanese Homes are WORTHLESS!

Why Used Japanese Homes are WORTHLESS!

[Music] Japanese homes are built to not last yeah  that’s right unlike most of the rest of the world   in Japan homes like this one are demolished and  replaced only after 30 years and by then they have  

Almost no resale value to speak of which is why  I could go to Japan and buy a house right now for   about $10,000 how is that even possible and what  does it mean for the people who live there well  

That’s what’re to figure out today I’m Ricky and  this is Two Bit [Music] davinci [Music] this video   is brought to you by delete me Japan is one of  the most densely populated developed countries   on Earth almost 125 million people live there with  857 people per square mile that’s almost 10 times  

Higher than here in the US being one of the most  technologically advanced countries you’d expect   that they’d make houses that last for decades  centuries even you’d also expect homes in Japan   to be really expensive however while that’s  true in some parts of Tokyo other major Urban  

Hubs it’s not as widespread as you might think  so that means that you and I could go to Japan   right now buy a fix rupper for about 10 grand  put another 20,000 or so to get it up to spec  

And have a house in Japan for less than $30,000  so I immediately set out to figure out [Music] why why is the Japanese real estate market so  odd unlike the rest of the world where homes   are considered assets that go up in price it’s  quite the opposite in Japan the first thing that  

Popped up in my research was something called the  30-year rule the 30-year rule for Japanese real   estate is the idea that most houses in Japan are  built to be demolished after about 30 years of use   and that’s why they lose their value so quickly  this is totally unintuitive for most Foreigners  

For example here in the US we’re used to seeing  really old houses in fact a lot of them are worth   a lot of money it’s why many people here invest  in real estate I’ll get back to that in a minute  

Because it’s really important to this story  but first as an engineer I wanted to see what   facts and figures support this claim so the first  question has to be how common is the 30-year rule   one way to measure how often houses are replaced  is to look at the building replacement rate which  

Is the ratio of new buildings constructed to  existing buildings demolished in a given year   I found that the replacement rate for residential  buildings in Japan is really high take a look at   this this table shows the rate at which houses  are rebuilt in Japan’s different prefectures  

In 2022 according to the data the medium building  replacement rate in Japan is 4.4% which means that   for every 100 buildings in the country between  four and five are demolished and replaced every   year now this is much higher than the rates in  the US and Europe where it’s around 1% or less  

In some swis cities for example it’s only 31%  of buildings that are replaced between 2016 and   2019 the other more obvious metric is the average  building age the notion behind the 30-year rule   comes from a report by the Japanese Ministry of  land infrastructure transport and tourism which  

States that the average Liv span of a wooden  house in Japan is around 27 to 30 years and   for reinforced concrete apartment buildings  it’s around 30 7 I found one research paper   that supports this idea and it could shed light  on where Japanese governments came up with this  

Rule according to the report wooden houses in  Japan after World War II until 1964 lasted on   average 22 years after that the average increased  to 33 years between 1965 and 1990 so the 30-year   rule apparently seems to check out at least  to some degree so then look at this this is  

A chart of the median age of homes in the US  since the 2000s it has increased steadily over   the past several decades and today stands around  41 years in the case of commercial buildings they   lasted around 53 years before being demolished  but according to MIT newly built homes have a  

Life expectancy between 50 and 63 years so yeah  30 years is kind of on the short side so then the   next question has to be what is it about Japan  where these buildings aren’t lasting as long   and as always the reason wasn’t simple I came  across a complex combination of History culture  

Geography and economics the root cause dates all  the way back to World War II as you probably know   know Japan suffered massive destruction during  World War II we actually made a video about why   Hiroshima is not a nuclear Wasteland we’ll put a  link down below security and safety have to matter  

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Experts on your side and save 20% on all plans  with delete me and discount code Ricky huge thanks   to delete me and you for supporting the show but  anyways after the war Japan faced severe housing   shortages and had to rebuild quickly and cheaply  this led to a boom of pre-fabricated lowquality  

Houses which were not meant to last very long  then there’s the issue of Japan being an Island   located on the ring of fire Japan is prone to  frequent natural disasters such as earthquakes   tsunamis typhoons and volcanic eruptions which  damage and Destroy many buildings every single  

Year therefore it makes sense to build houses  that are easy to replace and repair rather than   investing in more durable and expensive structures  and that really starts to give us a picture of why   homes in Japan lose value over time here’s a  graph showing the average home selling price  

In the US over the last 60 years years don’t have  to be an economist to tell that there’s a clear   trend for home prices going up even if there are  some crashes and dips along the way but in Japan  

Things looked different after the ’90s home values  in Japan started going down and almost leveled off   in the 2010s showing only weak signs of recovery  from there so what exactly happened here in 1990   to cause things to come crashing down well it  was what economists call Japan’s 1990s credit  

Crunch the bank of Japan tightened its monetary  policy by raising interest rates trying to curb   a recent inflation bubble in the late 1980s this  made it harder for the Japanese to get loans to   buy houses the lower demand made prices drop and  it was pretty bad if a Japanese person bought a  

House in the 1990s for say the equivalent of  $100,000 that house would have been worth just   a little over $53,000 in 2010 that house in the  US would have appreciated by 83% and now would   be worth $183,000 in 2010 and around 368 ,000 by  2022 which gets into a whole different problem is  

A topic for another video so it’s pretty easy to  see why the Japanese simply didn’t see their homes   as Investments but other key parts of the equation  is the Japanese culture this isn’t a video about   how different eastern and western cultures are  so I’m not going to go down that rabbit hole but  

After meeting many Japanese people and reading a  lot about their culture I came across the Japanese   principle of Wabi saabi this is a philosophy  that Embraces imperfection impermanence and   simplicity so Japanese aren’t naturally prone  to make an effort to perpetuate a culturally  

Insignificant house especially if it won’t even  translate to a higher resale value this doesn’t   apply to Heritage sites of course just newer  buildings as a consequence when most Japanese   inherit a home from their parents or relatives  it’s common for them to tear it down and build a  

New one instead of renovating it we generally  tend to be more attached to the memories of   the houses we grew up in the Japanese tend to see  houses as functional and disposable objects rather   than artistic or sentimental ones therefore they  often prefer to live in newer and modern homes  

Finally there’s the issue of construction codes  Japan is frequently hit by Major earthquakes so   construction codes in Japan change more frequently  than any other country building standards are   constantly updated and revised to incorporate the  latest knowledge and technology for earthquake   resistant design and construction for example  after the 1978 Miyagi earthquake the building  

Standard Act was amended in 1981 to introduce the  shin taian or new earthquake resistant building   standard this was updated again in the year 2000  and you’re not mandated to upgrade your property   in Japan to fit new standards that is unless you  want to renovate your home so suppose I’m in Japan  

And I inherited a rundown 25-year-old house if  I wanted to renovate it and make improvements   to it I would need to upgrade the structure for  the new construction standards making it really   expensive therefore most people just prefer to  build a new house there are other factors that  

Come into play as well like Japan’s population  collapse and its aging population but I think   you get the point the Japanese demolish more  homes than pretty much anyone else in the world   but one thing I personally love about Japan and  the Japanese is how they turn everything into an  

Art form even demolition when you build a house to  withstand the test of time you design and build it   with durability in mind not thinking about what  comes next but since the Japanese take down and   rebuild houses so often they actually design  and build them with demolition in mind this  

Is particularly impressive when you see the types  of joints they make when they build wooden houses   Japanese joinery is unlike any other I’ve ever  seen with these joints they can build an entire   multi- city house without using a single nail or a  drop of glue this is a 95-year-old wooden Japanese  

Home being torn down even though everything is  so old just by removing a couple of pressure   pins everything can be taken apart we can do an  entire episode about Japanese joinery it is truly   world class these are absolute Craftsmen but in  my head I was thinking sure that works on wooden  

Houses there’s no real equivalent in the world of  Steel and reinforced concrete right it would all   just be dynamite and Wrecking Balls for that but  it turns out I was wrong have you heard of Silent   deconstruction it’s basically disassembling a  building or building it in reverse instead of  

Demolishing it in Japan they’ve mastered silent  construction of high-rise buildings in one of   two ways in the first approach you start at the  top where building components such as the steel   columns beams and flooring are disassembled in  a close space while the ceiling is held up with  

Jacks every time the two highest floors are  dismantled the Jacks Are lowered letting down   both the roof and Scaffolding and the building  becomes two floors lower this is Tokyo’s famous   shrinking building the grand Prince Hotel aasa  the second approach is the opposite you start at  

The bottom and dismantle the bottom floor as the  entire building is held up with Jacks then you   cut the support column and lower the whole entire  building by a couple of feet Japan mastered the   art of making short-lived buildings that can  withstand some of the worst natural disasters  

They did it by designing buildings that were  easy to dismantle but that didn’t make them   any less resistant but times Chang and sorted  Japanese buildings today buildings aren’t the   cheap rushed pre-fabricated homes of the  1940s and in a country that is legendary  

For its earthquake resistant building code you’d  imagine that they’re pretty strong right so why do   even modern buildings only last 30 years and the  answer is they don’t remember how I said a minute   ago that the 30-year rule worked pretty well until  1990 that’s because it doesn’t hold true anymore  

This news article from the Japanese time sums it  up pretty well the notion that Japanese houses   self-destruct after 3 decades is a function of  the government’s plan to keep the economy humming   with a constant need for residential construction  since it was the land Ministry that concocted the  

30-year limit so what is the actual lifespan of  these homes in Japan well little digging turns   out closer to 63 years for wooden buildings  and 52 years for non-wooden buildings much   more in line with the rest of the world when I  first saw this article instantly triggered as  

Weird because the Japanese are legendary for being  such good Builders and highlevel Craftsmen but yes   culturally unlike the weekends to Home Depot to  renovate your guest bathroom in Japan things are   a little bit different and if you thought that was  interesting you got to check out this video next

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Why Isn’t Hiroshima a Nuclear Wasteland Like Chernobyl?

Japan is synonymous with craftsmanship, attention to detail and quality. But you might be surprised to learn, that homes in Japan, aren’t an investment, but lose value, more like a car. So why is that? Japan is a small country with limited land, you’d think housing in Japan would be astronomical, and in some areas like the heart of Tokyo, it is. But you can buy an older home in Japan TODAY for around $10,000. So today we’re going to get to the bottom of why that is!

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Chapters
0:00 – Introduction
1:30 – 30 Year Rule
3:00 – Why & History
5:25 – Geography
6:10 – Housing Bubble
7:05 – Culture
8:00 – Building Codes
9:15 – Japanese Demo
11:15 – The Future

what we’ll cover
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