Comment by theanphibian

April 30, 2008 @ 3:43 am

I seem to be having trouble playing the sound for this, but the old posts still seem to work. Maybe technical difficulties?

Comment by Garrett DeOrio

April 30, 2008 @ 12:17 pm

Should be OK now. Thanks for bringing to our attention.

By the way, for anyone who’s interested TPR now has a Twitter account - just to let everyone know what we’re doing and when it’ll be done, etc. Our username is TPRJP. Follow us - you’ll laugh, you’ll cry, you’ll know when our next release is coming.

Comment by MTC

May 1, 2008 @ 10:49 am

Garrett -

As regards urban highrise construction numbers, market demand would seem to more than sufficient to support the construction boom.

Let us take as a basic unit the floor of the apartment building I live in. It has five apartments and seven residents. If the building were 10 storeys tall (it is only 4), then it would be housing a population of about 70 residents.

Now the Tokyo Metropolitan District population added a net 99,000 persons to its population in 2007. Almost all of that growth was due to inward migration, rather than net births–meaning that almost all of the new resident growth required new housing.

Now how many of my imaginary 10 storey apartment buildings would contractors have had to finish last year just to keep the amount of available housing stock steady–i.e., not even trying to replace old and decayed housing stock?

Over 1400 such 10 storey buildings, by and large–and not just in 2007–every single year for the past 10 years.

And the 1400 buildings figure is just for housing–I have not even begun to think about commercial property development necessary to support the work, play and shopping activities of new residents.

When one reflects upon the above, and then sees the depressing fraction of existing housing stock that is beyond salvage, the scale of current real estate development in the TMD seems far from unreasonable.

Comment by Ken Worsley

May 2, 2008 @ 12:53 am

new resident growth required new housing

How many people died? Lots of places opened up.

Thing is, condo sales in the Tokyo area were down almost 18% in FY2007, as prices soared. The number of places closed within one month of coming online is down to the lowest level since 1991. New developments are not selling anywhere near the levels anticipated by developers.

There may be a need for some new places, but there are too many being built to be sold in the current market conditions, which are not expected to be better in the coming 12 months.

Part of the trouble with builders might be due to revised building codes, but that has suppressed supply as sales decline. Real estate developers are going bust at a disturbing rate. At the same time, those firms that do survive will be in great shape for the future.

Comment by MTC

May 2, 2008 @ 11:34 am

Ken Worsley -

…new resident growth required new housing…

“How many people died? Lots of places opened up.”

New resident growth is net growth. The number of people dying in the Tokyo area is factored in.

Thing is, condo sales in the Tokyo area were down almost 18% in FY2007, as prices soared.

As the providers of condominiums have raised their prices, demand has slipped. No surprise there.

The linked report says nothing about the number of housing units being put on the market, just that sellers have gotten greedy. As prices have shot ahead of the premium buyers are willing to pay, condo purchasers have gone to sidelines–waiting for prices to fall back to more reasonable levels. Greed makes the prices sellers want to charge “sticky” so there is a temporary mismatch between buyers and sellers.

However, because everyone except the homeless has to live somewhere, the prospective buyers must be renting rather than buying–and since the total population in the Tokyo Metropolitan Region is growing, the size of households is shrinking (meaning more units of housing are needed per capita) and 2%-3% of all housing must be replaced every year(assuming a 35 year effective lifespan of an average Tokyo living space–the actual lifespan could be shorter) the housing construction market in the Kanto should be huge and healthy.

Comment by Ken Worsley

May 2, 2008 @ 1:24 pm

“the housing construction market in the Kanto should be huge and healthy.”

I agree. It is huge, but hardly healthy. But it should be both.

I would like to see the ratio of condo ownership to renters, since what you say about household size shrinking is very true.

Comment by Ken Worsley

May 3, 2008 @ 6:38 pm

MTC,

The linked report says nothing about the number of housing units being put on the market, just that sellers have gotten greedy.

Actually, it did, but not clearly. The figures would have to be added together. Anyway, here they are.

Housing starts fell 21.5% in the Tokyo areas in 2007, with individual housing starts down 13.1%, rental housing down 20.7%, and multi-unit dwellings down 26.4%

Although Tokyo saw slight gains in January and February of 2008 (2.1% and 0.8%), the overall figure fell 11.7% in March.

The number of unsold units still on the market at the close of FY2007 was 10,837, the first time since FY1992 that over 10,000 new condos remained empty at the end of a fiscal year. Given the suppression of construction in 2007, it will be interesting to see if prices come in line with market demands and if t hese units are sold in 2008.