Japanese housing market has been in a state of limbo for months, with only a handful of developers and buyers taking the plunge to build homes in the country.
However, with prices falling in the last two weeks, Japan’s government is finally opening up some of the housing market to the public.
Read moreRead lessWith prices down around 7 percent in August, the housing sector is currently in the midst of the worst slump in a decade.
While the market has also seen a few positive signs of improvement, the latest figures show that the housing supply and demand situation remains precarious.
The market was hit hard in July by the global financial crisis, which left millions of households struggling to get by and led to a sharp drop in the number of new homes being built.
It also resulted in a sharp slowdown in new house sales, which are a key indicator of the state of the market.
This month, the country’s central bank announced that it is going to allow new home building, while encouraging new buyers to invest in new homes, a move that should have boosted the countrys housing market.
But a few months after the announcement, the situation has now changed.
Since then, the market is showing signs of slowing down, according to a report by the Nikkei Asian Review, which points out that the number one reason for the downturn has been a slowdown in the amount of new construction.
“In contrast to prior periods, the new building rate has decreased from an average of 10,000 per month in April-May to 4,000 units per month,” the report says.
The Nikkeis report notes that this trend is “likely due to a combination of the weak yen and low demand for housing, as well as the ongoing implementation of the National Housing Program,” which aims to promote the construction of housing in Japan.
The housing market also has been hit by a series of other factors, such as the worsening economic situation in Japan, which has led to higher mortgage rates and higher household debt levels.
However as the Nikkis report says, “a further strengthening of the economy in the second half of the year will help to further offset the weakening in the housing bubble.”
According to the Nikkiis report, the government has yet to set a timeframe for when new housing construction could resume, but there is hope that it will take place as early as 2020.
However, a number of developers are currently considering a move away from building homes in Japan’s biggest cities to the countryside.
According to the government, new housing will be allowed to be built in the countryside, as the government will “provide subsidies to encourage private-sector investment in new housing in rural areas.”
“However, while there is an appetite for new housing, the rural market remains undersupplied,” the Nikko report states.