## (Increase in Housing Expenses)

## ① Economic Burden of Owning a Home

If we look at the annual income magnification ratio of house prices (condominiums) of people under 30 or in their 30's, during the economic bubble, due to high land prices the price of housing (condominiums) rose, to 9.2 times and 7.8 times more by 1990. After the economic bubble burst, until the end of 1990, while housing prices dropped, the annual income magnification ratio also declined, and by 1998 they were at 7.2 times and 5.5 times respectively. However, since then, while the house prices started to rise, the annual income of young people started to decline, making the annual income magnification ratio continue to rise, reaching 8.7 times and 6.8 times by 2011 (Graphic 135).

When looking at the percentage of the mortgage repayments out of total disposable income, the percentage is rising for all age groups, but in the 30's age group the increase is at a higher level. This kind of economic burden that is involved in owing a home is thought to be one of the reasons for the aforementioned decline in the homeownership rate of young people (Graphic 136).

Graphic 135 Trend in Annual Income Magnification Ratio for House Prices (Condominiums)

(Note) 1 House price data is the nation-wide new condominium price sales from Real Estate Economic Institute Co., Ltd. "Condominium Market Trends Nationwide"

2 Annual income for until 2000 is from the working households' national average annual income based on MIC "Family Savings Survey"; for 2001 on the working households' 2002 January to March average annual income based on MIC "Family Income and Expenditure Survey (Savings and Liabilities)"; and for after 2002, the working households' yearly average annual income

Source) Developed by the MLIT from: Real Estate Economic Institute Co., Ltd. "Condominium Market Trends Nationwide"; MIC "Family Income and Expenditure Survey", "Family Savings Survey"

Graphic 136	Trend in Mortgage Repayment to Ratio to Disposable Income

(Note) Estimates from working households with a mortgage, with more than 2 people in the household

Source) Developed by the MLIT from: MIC "National Survey of Family Income and Expenditure"

## ② Housing Expenses of Rented Houses

The rent payment percentage out of total disposable income is also rising. From 1989 to 2009, the rent amount for men under 40 years old went from 12.4% to 19.9% of disposable income, and from 19.0% to 24.7% for women under 40 years old, and from 10.5% to 14.9% for households with more than two people, where the head of households is under 40 years old. From this we can see that housing expense has especially gone up for single person households. Furthermore, it seems that housing expense percentage is at higher levels for women than for men, but this can be attributed to the generally higher levels of housing cost for women, and the fact that women have lower amounts of disposable income (Graphic 137, 138, 139). One of the reasons rent is higher for women than for men is thought to be because women have higher demands and prerequisites for the amenities and specifications, particularly for issues related to safety, to be included in the privately-rented housing. Note

Trend in Rent Amount to Ratio to Disposable Income

(Note) 1 Estimates from working households