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Japan Housing and Non-residential Starts Summary- December & Year End

Shawn Lawlor

By Shawn Lawlor

Managing Director, Canada Wood Japan

March 2, 2020

December & Year End 2019 Japan Housing Starts Summary 

 

December total housing starts dropped 7.9% to finish at 72,174 units for the sixth consecutive monthly decline. Owner occupied housing declined 8.7% and rental housing fell 10.3%.  Wooden housing fell 8.5% to 42,822 units. Post and beam starts fell 7.6% to 32,621 units. Wooden prefab fell 11.4% to 982 units. Platform frame starts posted a 11.3% decline to 9,219 units. By housing type, the breakdown in platform starts is as follows: custom ordered homes dropped 16.6% to 2,787 units, rentals declined 4.7% to 5,696 units and built for sale spec homes decreased 31% to 1,007 units.

 

Looking at the year in review, the 2019 housing market showed progressive signs of cooling. Overall housing starts fell 4% to 905,033 units. Wooden housing fell 3% to 523,319 units. The overall market share of wooden housing continues to grow and reached 57.8%. Wooden post and beam starts fell 2% to 401,583 units. Wooden pre-fab fell 3.4% to 12,111 units. Platform frame construction fell 6.3% to 109,625 units as continued weakness in the rental housing market weighed heavily on the results for 2×4 housing. As a percentage of wooden housing post and beam increased from 43.5% to 44.4% and 2×4 housing fell a third of a percentage point. Going forward the Ministry of Land Infrastructure & Transport’s (MLIT) seasonally adjusted housing forecast is 852,000 units for 2020.

 

December & Year End 2019 Non-Residential Starts

 

December wooden non-residential starts totaled 1,577 buildings for a floor area of 312,723m2. Non-residential wood use for the month is estimated roughly at 54,727m3. Wood held a market share of 38% by number of buildings and 8.9% by floor area for the month. By usage elderly, medical care and social welfare facilities topped the list, followed by mixed residential-commercial and agricultural buildings.

 

Despite a slight decline in the overall non-residential market in 2019, wooden non-residential continued to show gains. The total non-residential construction market fell 2.6% to 53,783 buildings and 1.7% by floor area to 39,090,601 square meters. The number of wooden non-residential starts increased 0.3% to 19,373 buildings and floor area expanded 1.9% to 3,840,274m2 – indicative of an increase in the average size of wooden non-residential building. Estimated wood use in non-residential construction increased by 12,586m3 to 672,586m3.