Japanese property investment – what to watch out

Japanese property investment has been increasingly popular among foreign investors in recent years however, a lot of people interested in the investment who hasn’t done so has one big common concern….Earthquake.

Sure, if you remember what you saw on the TV after the 2011 earthquake in northern part of Japan, it does scare you and you may think your property will be nothing but mash and garbage which will worth nothing at all.

Don’t worry, this will not happen to most of the buildings as long as they have appropriate seismic strengthening (built after 1981). However there are indeed, types of building which will be nothing but bunch of wood-chip if big earthquake hits.

Over 90% of the wood made residential structure with less than 2 story is prone to a major earthquake – there is a very likelihood that a structure will collapse.

Japan Wooden Residential Structure Organization for an Earthquake-Measure (Mokutaikyou), an industrial organization that tests an earthquake resistance of wood-made residential units, analyzed the result of the tests from 2006 to 2014. 20,889 samples, built between 1950 to 2000, were analyzed. It turned out when an earthquake of magnitude 7+ hits 75.09% of unit is highly likely to collapse, and 16.67% of unit is likely to collapse.
This risk is attributed to the fact that a lot of wood-made residential units were built prior to 1981, the year when the law for earthquake resistance for a building was strengthened. The law dictates that any residential unit must withstand with an earthquake with a magnitude of 7+. Prior to the amendment, the law dictated that an unit must withstand with an earthquake of magnitude 5-7.
The result apparently shows that wood-made units are not the case.