> They'll do a study on this by studying Japan
And miss the point that the way real estate works in Japan is fundamentally different from the US.
In Japan, land ownership doesn't really help build wealth, so people are happy to densify.
And miss the point that the way real estate works in Japan is fundamentally different from the US.
In Japan, land ownership doesn't really help build wealth, so people are happy to densify.
It's possible this could change somewhat going forward as newer homes have much better construction. This would still depend on the country figuring out how to grow the population though.
I can only speak for Tokyo, but it basically means that if you buy land for $400k and build a house for $200k, the value of the second will slowly approach zero, while the price of the land does what it does.
In Tokyo this appreciates a bit, so your wealth remains more or less the same.
If you go outside of Tokyo though, where the ratio becomes more like $50k land, $100k house, it’s easy to see that it’s not something you do as an investment. Land won’t increase in value there either as everyone is leaving for Tokyo.