[Bookmark] Akiya and Inaka: The Complexities of Buying Empty Houses in Japan’s Countryside

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When the COVID-19 pandemic hit Japan nearly two years ago, Zoom meetings quickly took the place of in-person work at central office buildings in Tokyo and other big cities.

As the pandemic wore on and Japan adjusted to the new normal of remote work, many employees and companies began to think beyond the coronavirus restrictions. What was at first a quick fix for an unprecedented modern challenge gradually felt liberating for many. Japan’s millions of office workers started to imagine a different working lifestyle not dependent on commuting in and out of congested metropolitan areas five or six days a week.

With Zoom, one didn’t need to live in relatively small apartments near big cities anymore, getting crushed twice a day in overpacked trains. Zoom made it possible to work from anywhere. 

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So why not light out for the Japanese countryside, where the air is fresh, the people are friendly, locally-grown rice and vegetables are abundant, and land and houses can be had for a song? 

This dream of wide-open spaces led to interest in cheap properties in the country. For several years now, the internet has been awash in articles about so-called akiya or abandoned houses. 

Japan is not the only country in the world to face an akiya problem, to be sure. But Japan’s akiya phenomenon has gotten arguably more attention than similar problems elsewhere. Due to factors such as declining population growth and the ongoing trend of Japanese young people relocating to Tokyo, many houses in Japan do indeed stand empty, or at least underused.

Hidden Complexities of Akiya

These abandoned or neglected houses are not only a financial drain on the local economy, they are also dangerous and unsanitary. Municipalities with an akiya problem lose tax revenue that an occupied property would otherwise generate. As houses deteriorate, they can be overrun by wild animals and vermin, collapse, or catch fire.

To counter the akiya challenge, many local governments have set up “akiya banks” or listings of houses which currently have no occupants and often no owners. Governments are anxious to unload these properties by selling them off to buyers, sometimes at listed prices in the equivalent of just a few hundred US dollars. Zero-yen — that is, free — houses are also not uncommon. 

“The akiya banks list akiya, it’s true,” says Parker Allen. “And, yes, the prices can be very cheap. On paper. But when people try purchasing akiya, for example, for remote work or to start a new business in the countryside, they find that things are considerably more complicated on the ground.

“The Japanese real estate market is a reflection of much deeper social issues in Japan,” Allen continues. “Moving to the countryside, the inaka, or buying an akiya, is not just a move or a purchase, but a transition to a side of Japan that people living in big cities — Japanese citizens and foreign residents alike — often need help navigating. That’s where we come in.”

A Vision, a Business, a Mission for Social Change

Allen is one half of the start-up consulting firm Akiya & Inaka. His business partner is Matt Ketchum. Between these two Americans — Allen from Chattanooga, Tennessee, and Ketchum from Pittsburgh, Pennsylvania — they have nearly 25 years’ experience living and working in Japan.

Much of that time has been spent in the Japanese countryside.

“There are not many Japanese people in Tennessee, where I grew up,” Allen says in an interview with JAPAN Forward. “But there are a lot of Japanese companies. One of those is Komatsu, a heavy machinery firm with an office in Chattanooga.

“Thanks in part to the Komatsu connection, I had studied Japanese in junior high school and high school, and ended up doing an exchange program through the Chattanooga School for the Arts and Sciences that sent us to Tono in Iwate Prefecture in the northeast,” he adds.

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Allen ended up returning to Japan to attend university, at Sophia University in downtown Tokyo. He built a career in communications consulting, eventually founding his own public relations company, Parthenon Japan.

Ketchum’s foray into Japan also took him to Iwate, but with a much darker turn ahead. He was teaching English in the town of Miyako in March of 2011 when an undersea earthquake triggered a mammoth tsunami, which nearly wiped Miyako off the map. He remembers watching in shock from afar as his adopted town was swamped, and then as his apartment and many other of the remaining buildings burst into flames.

He spent the next several months in Iwate, helping with the rescue and relief work, before relocating to the Azabu-Juban district of Tokyo to work at an art gallery devoted to raising awareness about Japan’s northeast.

This was the beginning for Ketchum of what was shaping up to be a new life path for him: searching for ways to revitalize Japan’s earthquake-, tsunami-, and nuclear disaster-devastated northeast, and the Japanese countryside more broadly.

In August of 2020, as the two Iwate-connected Americans saw that what many in the media were heralding as a remote-work miracle for the inaka was fizzling out, they formed Akiya & Inaka to facilitate relocations to properties outside of the crowded, pandemic-ridden big cities.

Big-Data Akiya Hunting

The 2011 triple disaster they experienced in Iwate played a big role in sparking Allen and Ketchum’s awakening to the possibilities for inaka revitalization in Japan. Serendipity played a big role, too.

In 2015, Ketchum was searching for ways to rethink the akiya problem and to connect city dwellers with good real estate deals in the countryside. He began digging into data sets, tracking the actual situations of akiya listed in akiya banks. He had no idea at the time, of course, but Matt’s data-mining groundwork helped tremendously when people began scrambling to access akiya banks during COVID-19.

“An akiya bank listing is usually pretty sparse,” Ketchum tells me. “You might have a price and an address, maybe some photos. I realized that the way to get beneath the data and understand the akiya problem was to visit akiya in person. That’s what I began to do.”

Allen explains that this intimate knowledge of individual akiya allows their firm to select properties specifically suited to each client’s needs.

And those clients are increasing in number. COVID has caused many not only to rethink work, but also life. The inaka appeals to many who might never have considered a move to rural Japan just a few years earlier.

Regulatory Hitches and Skewed Market Dynamics

There’s another way in which Akiya & Inaka helps clients get past the initial stage of browsing through akiya banks.

“Most properties in Japan are sold through real estate agents,” Allen says, “and not by the owner or a representative like an attorney. Per Japan’s Real Estate Brokerage Act, a maximum limit is established on the commission a real estate agent is allowed to charge on a real estate transaction.”

This fixed commission and tendency to sell properties through real estate agents can lead to market inefficiency. While the low prices listed in akiya banks are what initially attract many potential buyers, those low prices are also part of what is keeping akiya from being sold off.

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“Many akiya are remote, maybe a two- or three-hour drive from a real estate agent’s office,” Allen continues.

“That’s nearly a whole day’s work each time a prospective buyer wants to see the property. But if the akiya is listed for, say, the equivalent of one thousand US dollars, or even ten thousand US dollars, then the real estate agent is virtually guaranteed to lose money on the deal. Three percent of such a low listing price may not cover the time and expenses of showing the property even once, let alone multiple times.”

“Most people in Japan think that any real estate transaction will take at least three years,” Ketchum says. “Akiya & Inaka helps clients overcome the regulatory hitches and skewed market dynamics, and also does the legwork of looking for suitable properties so the client doesn’t have to travel the length and breadth of Japan him- or herself.”

“We are partnered with a legal services firm and work with licensed real estate brokers, judicial scriveners, and other legal experts who oversee the paperwork, including the closing documents and other procedures needed to transfer title,” he continues. “We also check the deeds and other municipal paperwork ourselves, to make sure that the owner holds the property clear of any disputes with neighbors, liens, inheritance troubles, or other potential impediments to a smooth sale.”

Connecting the Inaka to the Metropole

While the real estate forms and closing process can be daunting, what is really needed is local knowledge, knowledge virtually impossible to glean from an akiya bank.

What is the property really like? What kind of a neighborhood is it in? Is the local environment arid, damp, cold, in an agricultural region, tucked in the hills, on the side of a mountain? What kinds of wildlife are in the area — including wildlife such as boar, monkeys, and bears? What are the possibilities for clients who come from every walk of life and with varying levels of Japanese-language ability?

“We’re not a real estate agent,” Allen emphasizes. “We are a total-service consulting firm. Matt is the Akiya Hunter. He spends a lot of time making content series, such as Akiya Adventures, Inaka Living, and (the eponymous, in a sense!) Akiya Hunter. I am often at our home base in Omotesando, Tokyo.”

“Together,” Ketchum follows up, “we are not just connecting clients to countryside properties, we are helping to rebuild the networks that have fallen into disrepair as Japan’s inaka has emptied out.”

“There’s not much happening in the countryside,” Allen says. “No jobs, not much hope for young people. As in the United States and many other countries around the world, ‘success’ is often defined as having a high-paying office job in a big city. So part of our work is in helping shift the conversation, showing that inaka life, whether it means buying a rustic besso (vacation cottage) or relocating to the hinterland full-time, can be rewarding, even liberating.”

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“It’s a lot of narrative wrangling,” Ketchum agrees. “Is the inaka a problem or an opportunity? We think it’s both. There are problems with akiya, problems in the inaka. But those problems are chances if you have the right information and the right mindset.”

Japan’s Conflicted Relationship with the Countryside

Ketchum and Allen say that there is a lot more background to the inaka topic than the “narrative wrangling” about population decreases and job opportunities.

“There tends to be an emotional connection to the inaka in Japan,” Allen says. “Much of that connection is tenuous, more sentimental than concrete. The lure of the furusato or natal village is still very strong. But the reality is that many Japanese people have left their furusato long ago, maybe during the bubble years of the 1980s, or even earlier, during the building booms of the 1960s or before World War II.”

“There are also subliminal clues in advertising and the media that the inaka is somehow inferior,” Ketchum says. “People dream of going to the inaka, but at the same time, people would never dream of going to the inaka. It’s a conundrum.

“It’s one thing to long nostalgically for a lost countryside, a real Japan. It’s quite another to wake up in a 150-year-old drafty wooden house on a December morning, or to go outside and smell the manure your neighbor is spreading on his field.”

“This conflicted approach to the inaka has caused many of the problems that Akiya & Inaka is trying to help solve today,” Allen adds. “Take solar panels, for example. There have been landslides in rural mountains due to the overuse of solar panels, which block the sun and lead to the loss of plant life in an area, which in turn contributes to erosion. In some ways, solar panels in the countryside are a sign that some people in big cities may see the inaka as an outlying region to be exploited, not as a place worthy of long-term care.”

“You can see this in preservation laws, too,” Ketchum says. “Unlike the United States or European countries, there are very few laws here designed to protect heritage architecture or valuable old structures. The inaka is a place in need of human tending, but that is missing at many levels, from the administrative and political down to the ground level, the level of actually going and spending time in rural prefectures like Gunma, Ishikawa, or Nagano.”

Interestingly, Allen and Ketchum reveal that akiya sales networks are more efficient the farther one travels from Tokyo.

“In Toyama,” Ketchum says, speaking of a prefecture on the Japan Sea side of the main island of Honshu, “the akiya turnover is much more efficient than in places nearer the metropolis. Big city buyers appear to be distorting the market, perhaps due to common myths about akiya’s being cheap and easy to buy up.”

There are other problems besetting the countryside as well. State agents from the People’s Republic of China buy tracts of rural land near national security installations in Japan, for example. And then there are vacation properties owned by Tokyoites who have fallen behind on their loan payments, as well as environmental issues that affect the livability of a given tract of land.

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The Future of the Inaka

In many ways, the misperceptions that so many in Tokyo and other big cities have about the Japanese countryside is a product of distance, unfamiliarity.

“COVID upended a lot of things here,” Parker Allen tells me at the end of our interview. “Many people in Japan want to escape Tokyo, but it remains to be seen whether people will overcome the hurdles to living in the countryside.”

“The future of the inaka, whether in the disaster-ravaged northeast or anywhere else, depends on engagement,” Ketchum concludes. “I have seen so many revitalization efforts fail in Iwate and elsewhere. If the Japanese countryside is to recover, then people have to go out there.”

“Our job is to make the introduction,” Allen says. “After that, the possibilities are endless.”

RELATED: Putting Empty Spaces to Work: The Akiya Issue is Everyone’s Problem

Author: Jason Morgan