CNBC - Tokyo Real Estate Bubble | Tokyo
Information | History | View | Sightseeing | Video
Comments
-
Why is Japanese land so costly? The reason is quite simple. There is no annual tax on the value of land. The potential rental value of land is capitalized into higher and higher land prices. Japan's cities are headed toward another crash as bad as in 1989. The policy choice should be to gradually tax away the rental value of land while exempting property improvements from the tax base. If they do not so this soon, no business will be able to pay the land prices asked and remain profitable. No household will be able to accumulate the savings to become a homeowner. The Japanese economy will come crashing down on top of the collapsed property markets.