Here’s a Google-translated ad for new houses for sale in suburban Hiroshima; just this one small advertisement for new houses required a lot of research and explaining to make sense!

• Housing is indeed inexpensive: the prices are around ¥30M (=3,130 x ¥10,000), or about US$200K at the current, extremely favorable, exchange rates.
• Mortgage terms are unbelievable. Note the monthly payment of ¥60K, or US$400 given a 50-year (!) mortgage at 0.45% (!). No wonder the carry trade is so huge!
• As a result, these new houses are broadly affordable; the monthly payment is just 13.6% of the 2019 median household income in Hiroshima prefecture (Japanese household income/expense survey link).
  • Then again, housing is less than 10% of household expenditures in Japan. About 43% of Japanese households are unmortgaged homeowners, which appears to be a fairly typical percentage among OECD countries.
  • Contrast that with American consumers, who spend US$2,120 per month on housing – more than Japanese consumers spend on everything in a typical month.
• The houses are small, but space-efficient and land-efficient. They’re ~1100 square feet, but fit 3-4 bedrooms, and sit on lots about as large – small even by “small lot” US standards. I’m guessing that zoning limits the site to a 1.0 floor-to-area ratio, which would be typical of an urban neighborhood in the US.
• At lower right is a tiny subdivision plot plan. Small “mini-kaihatsu” subdivisions like this (<1000 m2, or ~11K sq ft) are exempt from site-permit review, reducing the “soft costs” of building housing. Besides, semi-private residential alleys have long been where workers have lived in East Asian cities, whether Beijing’s hutongs or Osaka’s nagaya.
• The street widths would be considered unconscionably narrow by US standards that frequently require 50′ rights-of-way. Yet at 5-6m (16-19.6′), they comfortably exceed the 4m (13′) national minimum; this is meant for car access, after all.
• The location that matters most: “8 minute walk to train station” is in the upper right corner (cropped out in this view). The “two car parking” probably assumes two tiny kei cars, and is more likely enough for one normal car plus some bikes. After all, you can’t register a car without having an off-street parking space.

Building and zoning codes reference link: www.iibh.org/kijun/japan.htm
Brookings Institute overview www.brookings.edu/articles/japan-rental-housing-markets/
English blog on Japanese housing: catforehead.com/

If those are the prices for suburbia, how about infill? Here’s an ad for new high-rise condos in the downtown area of Yokosuka, a seaside southern suburb of Yokohama that’s home to a large US Navy base. It’s half an hour to Yokohama by train and one hour to southern Tokyo, and one-bedroom units begin at ¥27M, or US$177K today.

This ad was for a Keikyu condo, near a Keikyu station, and seen on a Keikyu train. Land development is how American streetcar systems made their fortunes, and it’s still a legitimate business model across Asia today.