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Japan's property lending tops charts amid investment craze

But residential boom could unravel as population shrinks

A residential neighborhood in Tokyo

TOKYO -- Lending to Japan's real estate sector climbed 15.2% to a record in 2016, supported by brisk property investment amid rising land prices and the central bank's negative interest policy.

While this investment boom has yet to result in an asset bubble, the Bank of Japan and financial regulators plan to remain vigilant as booming construction could be out of step with demand, spelling default risks down the road as the rental market shrinks.

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