2022 Yeard End Japan Housing Starts & Non-residential Construction Reports
January 2023 Japan Housing Starts
January total housing starts gained 6.6% to 63,604 units. Owner occupied housing fell 8.3%, whereas rental housing gained 4.2% in January. The mansion condominium market jumped 69.6% in January, however, it is important to note that this segment can be volatile on a month to month basis. Wooden housing declined 3.6% to 32,509 units. Post and beam starts fell 5.9% to 25,690 units. Wooden prefab starts were jumped 23.6% to 682 units whereas total prefab dropped 10% to 7,325 units. Platform frame starts increased 4.8% to 6,137 units. Results of 2×4 starts by housing type were as follows: single family custom homes increased 6.5% to 2,096 units, rental housing gained 8.7% to 3,240 units and built for sale spec housing fell 10.2% to 797 units.
January 2023 Non-Residential Construction
January total non-residential starts remained flat at the 3,200 units level. However, total floor area increased by 28.2% to 3,680,257m2, led by increases in restaurants & accommodation, transportation and logistics, and mixed residential and commercial. Non-residential wooden starts advanced 3.6% to 1,173 units. Non-residential floor area increased 4.7% to 206,186m2. The leading segments for wood demand were medical, elderly and social welfare facilities, mixed residential and commercial, and restaurants & accommodation.
Japan 2022 Housing Starts Summary
Total Japan housing starts edged up 0.3% to 859,362 units in 2022. Housing activity was robust in Q1, but gave back gains more often than not in the second half of the year. Pandemic related economic uncertainty and rising inflation weighed on the consumer confidence of prospective homebuyers as owner occupied starts trailed for 13 consecutive months. Rental housing in contrast continued to advance on year prior results for 22 consecutive months.
While in recent years wooden starts continued to garner an increasing market share of total starts, this trend reversed in 2022 with wooden starts falling 4.9% to 477,817 units. Post and beam starts fell 4.9% to 376,486 units and platform frame starts fell a similar 5.0% to 91,209 units. Non-wood starts increased 11.2% to 279,218 units. Wood’s market share fell from 58.6% in 2021 to 55.6% in 2022. The “Wood Shock’s” dramatic runup in lumber prices in 2021-2022 was a contributing factor in the shift away from wood to alternate building methods. And while in recent years 2×4 starts lost ground to post and beam housing in 2022 both building methods performed similarly. For 2023 the Research Institute on Construction and Economy forecasts total Japan housing starts at 851,000 units.
Japan 2022 Non-Residential Construction
In 2022 total non-residential building starts grew a marginal 97 units to finish at 46,804 starts. Total floor area increased by 343,163m2 to finish the year at 38,728,866m2. Total wooden starts increased by 2.6% to 17,555 units, but total wooden floor area declined 1.5% to 3,223,680m2. Total 2022 estimated annual wood use in new non-residential construction finished at 564,144m2. Medical, Elderly Care and Social Welfare, Mixed Residential & Commercial, Restaurants and Accommodation and Agricultural buildings led the wood use segments.