> The first thing to note is that in Japan, housing isn’t an investment. It’s a place to live. The country’s slow population growth means that increases in property values aren’t guaranteed
I feel like this is a misleading way to put it. Japanese houses decrease in value, generally quite severely - the conventional wisdom is that after a few decades you might as well just tear it down and build a new one. So there's very real option value you're losing in the Japanese model; if you have to move in a decade or two, you won't be able to get back the equity you put in.
I feel like this is a misleading way to put it. Japanese houses decrease in value, generally quite severely - the conventional wisdom is that after a few decades you might as well just tear it down and build a new one. So there's very real option value you're losing in the Japanese model; if you have to move in a decade or two, you won't be able to get back the equity you put in.