Since COVID-19 forced Americans to reconsider where and how they live, the U.S. housing market is so hot that it’s leaving would-be buyers outbid and burnt out. Meanwhile, in Japan, all it takes to buy a home is roughly $500—and a willingness to live in a “ghost village.”
The phrase refers not to any supernatural phenomena but the fact that Japan’s decades-long trend of negative population growth coupled with an exodus to urban areas has resulted in roughly 8.49 million akiya (unoccupied homes) according to the country’s most recent Housing and Land Survey from 2018. Tsutsui Kazunobu, a professor of regional studies at Tottori University, told Insider that the number of households per rural community stood at 39 in 1960 but fell to 15 by 2015, and a May 2021 report from the Organization for Economic Cooperation and Development pegs Japan’s nationwide rural vacancy rate at about 16%.
Those statistics explain why Japanese Prime Minister Yoshihide Suga entered office in September 2020 with a mandate to focus on bridging the urban-rural divide. Subsequently, local governments are pulling out all the stops to incentivize the kind of rural homeownership and repopulation that can, in turn, fuel economic revitalization. Those offers include renovation subsidies for those who remodel and move into a spruced-up akiya, along with steep property tax discounts for akiya buyers.
But perhaps no offer is as enticing as the “akiya banks.” They aren’t actual banks but are websites that basically function as a Zillow for cheap, abandoned homes in certain communities such as Wakayama prefecture, whose eponymous regional capital sits about an hour and 15 minutes from Osaka. About 200 of the 600 listings on Wakayama’s akiya bank since its 2015 launch have found new occupants, with current prices coming in at about $800 on the low end. At other akiya banks, prices as low as 50,000 yen (about $455) aren’t unheard of.
Though you’d think teleworking Japanese professionals would jump at the chance to buy a fixer-upper for less than Tokyo’s median monthly rent, there are a few hurdles that have kept buyers from completely embracing the akiya. Douglas Sutherland, the Organisation for Economic Co-operation and Development’s senior economist for Japan, told Insider that there’s generally less interest in DIY home renovations in Japan than there is in the U.S., which could contribute to an environment where most akiya appear to be more trouble than they’re worth.
While foreigners aren’t excluded from buying akiya, there are a number of hoops to jump through that make owning one expensive if not impossible. Beyond renovation costs, a 1981 update to Japan’s Building Standard Law also means these homes are considered fragile enough to require structural work to bring them up to code. Furthermore, property rights make it almost impossible for people to knock down these akiya and start fresh without approval from their (technical) homeowners, despite the fact that they want little to do with the property. Thus, the unwanted homes persist, stuck between renovation and demolition.
Despite those hurdles, the idea of buying a home and/or starting a business for such a low price has proved too good to pass up for some. With top-level buy-in from the government, there’s always the chance that some of the legal obstacles to increasing rural homeownership could fall by the wayside. For now, though, many Japanese urbanites seem to feel that if a $500 home sounds too good to be true, it probably is.
Originally Appeared on Architectural Digest