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Economy

Japan keeps building suburbs even as population shrinks

Empty homes mushroom in urban areas, stalling plans for compact cities

The Tsukuba Express passes through Tsukuba, Ibaraki Prefecture. Areas along the train line have logged population growth. (Photo by Nobuyoshi Shiota)

TOKYO -- As Japan's population shrinks, consolidating scattered residents into denser, more compact cities is increasingly seen as a must. Yet the steady outward creep of the suburbs continues unabated.

In the 10 years through 2015, residential areas expanded by 1,773 sq. km, an area three times the size of Tokyo's 23 central wards, according to an analysis by Nikkei and the Nikken Sekkei Research Institute.

The growth suggests failures of both the real estate market and urban planning. Even with an estimated 8 million homes vacant, many in urban centers, new ones continue to be built in cities fighting over a shrinking population pool.

And new suburbs want their own shopping centers, hospitals, libraries and community centers, raising the risk of ballooning municipal costs.

"It's important to have existing housing circulate" in the market, said Yosuke Sunahara, a Kobe University law and political science professor who argues for policy priorities to shift away from new-home construction.

A new neighborhood in Hiroshima. "The house is big and many people around us are from the same age group. It's easy to live here," says a woman in her 30s who moved in from the city center.

The Nikkei-led study found that only a fifth of the new residential blocks -- defined as plots of 500 sq. meters housing at least 50 people -- contained 100 or more residents. Just 3% had 500.

Of the 1,386 cities, towns, villages and wards covered by the study, 43 added more than 5 sq. km of residential area. Seven of the top 15 municipalities in terms of growth allowed residential land to expand despite having so-called compact city plans.

The expansion reflects a scramble by depopulating municipalities to attract more people. Restrictions have been eased on suburban housing construction, turning farmland and hillsides into houses and apartments. Hiroshima has allowed development to expand deeper into the nearby mountains, even after a deadly 2014 landslide.

In Asaminami, Hiroshima, many new houses were built on lots cut into a steep mountainside. According to the developer, a single house with a garden can be bought for around $275,000.

A housewife in her 30s who just moved in from the city center said: "The house is big and many people around us are from the same age group. It's easy to live here."

The "if you build it, they will come" approach worked for the city of Tsukuba, about 50 km northeast of Tokyo, which saw the largest gain in residential area at 12 sq. km.

Since the 2005 opening of the Tsukuba Express train line to Tokyo's Akihabara Station, fields along the route have transformed into rows of homes. More than half of the new residential blocks in Tsukuba had at least 100 people, and 8% housed 1,000 or more.

Mayor Tatsuo Igarashi welcomes the population boost from the train but is concerned about the future financial impact. The city's spending is projected to exceed revenue starting in fiscal 2035.

"If only our population keeps growing, we'll go into the red," he said.

Low-density populations make it more expensive to build and maintain necessary infrastructure and handle public services, even as tax revenues shrink.

Many local governments recognize sprawl as a problem. Roughly 270 municipalities across Japan, including Tsukuba, have drawn up plans to concentrate housing and public works construction in urban centers. But follow-through has been lacking, in part because large-scale efforts that would require people to actually pick up and move closer together are politically taboo.

When populations spread out into the suburbs, downtown areas risk being neglected and falling into disrepair. The problem is especially acute in Osaka, where 17.1% of homes were vacant as of October 2018 -- above the national average of 13.6%. Abandoned homes are on the rise in smaller cities as well.

Many experts say creating cities suited to a shrinking population will require re-tightening the loosened restrictions on housing construction that have permitted the rise in suburban sprawl.

But "strengthening regulations carries a risk that we lose population to neighboring cities," according to a city planner in Hiroshima.

A more active property market is needed, as well as steps to revitalize urban centers, such as renovation and reuse of vacant homes.

"We need measures to make sure that the value of existing homes does not decline unreasonably," Kobe University's Sunahara said.

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