This book addresses essential questions about housing by building
theoretical models based on various real world problems in Japan and
testing these models using econometric methods. Almost all related
empirical analyses use Japanese household longitudinal data.
Accordingly, the author analyzes whole aspects of the data, based on an
understanding of the actual situation, theory, and empirical analysis,
to directly derive a vision of a future housing policy.
Why are houses expensive and difficult to obtain in Japan? Why do people
have to live in small houses? Why do people not relocate frequently? Why
is the earthquake insurance subscription rate so low, particularly in an
earthquake-prone country such as Japan, even after such a catastrophic
event as the Great East Japan Earthquake of 2011? How do existing
housing finance and tax policies or laws relate to these real world
problems? To answer these questions, the book clarifies the unique
criteria that characterize housing problems in Japan and presents a
vision of future housing policy.
The short answer is that existing housing finance policy that adopts
criteria based on the floor space of houses creates incentives for
people to live in even smaller houses. Furthermore, the Japan Rental
Act, which affects people renting homes, reduces residential mobility.
The incidence of underinsurance against earthquake risk is a result of
earthquake insurance market imperfections such as crude and rough
geographical risk ratings.
The book elaborates on these factors in four parts and will be of
interest to all readers who are concerned with the housing market and
household behavior in Japan.
