Japan will be seeing more requirements for its existing-home market. Such steps is planned to achieve and improve transparency in the said market by seeking to diminish buyer doubts and check brokers that attempt to monopolize properties.
The Japan Land Ministry will be expanding in January its system for developers to have a record of property infomation. Although there are 10% existing homes of housing sales in Japan, the number of empty homes have risen 24% to 8.2 million, according to Nikkei.
Japan has seen an upward rise in the number of empty homes. And this greatly affects the real estate market. According to Japan Property Central, “Japan has over 8,000,000 empty homes and apartments, representing 13.5% of the housing stock. Almost 70% of those are in buildings over 35 years old, and 44.5% are in buildings over 45 years old."
The requirement from the law seeks that if one broker is chosen as a representative, the company has to record information regarding the property in the system in order to protect the client from bad deals. Moreover, this will apply to information such as property's address and price, and not the status of the transaction. Also, brokers should report whether a property is open to offers.
The move to a more strict disclosure is due to reports of unfair practices by some real estate businesses in the country. In addition, the ministry will also be encouraging home inspections by experts in response to concerns about the quality of the homes being sold.
The tighter disclosure requirement could be the first of many land ministry reforms that could help with Japan’s latest problem. The country could also move to make further laws to be applied on the existing but empty homes.
What are your thoughts about the tighter disclosure requirements of Japan’s Land Ministry?