IMF Working Papers

Demographics and the Housing Market: Japan’s Disappearing Cities

By Yuko Hashimoto, Gee Hee Hong, Xiaoxiao Zhang

September 25, 2020

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Yuko Hashimoto, Gee Hee Hong, and Xiaoxiao Zhang. Demographics and the Housing Market: Japan’s Disappearing Cities, (USA: International Monetary Fund, 2020) accessed September 20, 2024

Disclaimer: IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.

Summary

How does a shrinking population affect the housing market? In this study, drawing on Japan’s experience, we find that there exists an asymmetric relationship between housing prices and population change. Due to the durability of housing structures, the decline in housing prices associated with population losses is estimated to be larger than the rise in prices associated with population increases. Given that population losses have been and are projected to be more acute in rural areas than urban areas in Japan, the on-going demographic transition in Japan could worsen regional disparities, as falling house prices in rural areas could intensify population outflows. Policy measures to promote more even population growth across regions, and avoid the over-supply of houses, are critical to stabilize house prices with a shrinking population.

Subject: Housing, Housing prices, Inflation, National accounts, Population and demographics, Population growth, Prices

Keywords: Akiya (vacant houses), Condominium price, Durable housing model, House, House price, House prices, Housing, Housing price, Housing prices, Inflation, Population change, Population growth, Price, Price appreciation, Price change, Price decline, Price dynamics, Regional disparity, WP

Publication Details

  • Pages:

    34

  • Volume:

    ---

  • DOI:

    ---

  • Issue:

    ---

  • Series:

    Working Paper No. 2020/200

  • Stock No:

    WPIEA2020200

  • ISBN:

    9781513557700

  • ISSN:

    1018-5941

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