TOKYO — Long-abandoned homes in Japan are bringing down the values of surrounding properties, with losses reaching 3.9 trillion yen ($24.7 billion) over the five years through 2023, new calculations show.
The large sum underscores the scale of a problem that is fueling a vicious cycle of plummeting prices and more unsold properties.
The data was compiled by the Japan Akiya Consortium, which brings together 14 companies and a research institution to tackle the problem of abandoned homes — or akiya in Japanese. The figures were based on 2023 government statistics and research by the Center for Real Estate Innovation at the University of Tokyo.
The number of abandoned homes that are not for sale or available for rent but have remained empty for a long period of time increased by around 360,000 units between 2018 and 2023 to about 3.85 million units. More than 70% of these were detached, single-family houses.
In many cases, land prices within a 50-meter radius of abandoned homes were on a downward trend, the consortium’s research found. Potential causes include a decrease in the number of people looking to move in due to concerns about vegetation overgrowth, pests and public safety.
An estimated 80% of the single-family houses that became abandoned in the five years through 2023 brought down the values of surrounding properties by about 3.9 trillion yen.
While the Ministry of Land, Infrastructure, Transport and Tourism said that residential land prices rose for three consecutive years until 2024, abandoned houses may have suppressed the rate of that increase.
“Our estimate was limited to the impact of abandoned single-family houses on land prices,” said Teppei Kawaguchi, CEO of Crassone, a construction and demolition services company that leads the consortium. “The actual negative impact may be even greater.”
In the case of abandoned condos, which were not included in the estimate, missing owners can mean payments of management and repair fees are delayed, bringing down the asset value of an entire building.
“There is great concern that losses will increase exponentially in the future,” said Takeshi Ide at real estate research company Tokyo Kantei.
In areas where abandoned houses are on the rise, there are many elderly people living alone, increasing the chances of their homes becoming abandoned in the future. “Those homes will also become abandoned after the death of the owner if nobody inherits them, and land price losses may snowball,” Ide said.
Even though the population is decreasing in Japan, the number of households has continued to increase due to more people living alone, and is expected to peak in 2030, according to estimates by the National Institute of Population and Social Security Research. The total demand for housing will begin to decrease in earnest after that, which could accelerate the growth in abandoned homes.
The government has taken legal measures to deal with the issue, such as making inheritance registration mandatory. “When the number of households also starts decreasing, there will be limits to responses to individual vacant homes,” Ide said.
