Japan Housing Starts Report: Upside Surprise in March
Japan total housing starts for March surged 39.2% to finish at 89,432 units. The surprise surge is likely due in part to builders aiming to get their building permit applications in before April 1st when changes to Japan’s Building Standards Law (BSL) came into effect. Changes to Japan’s Energy Conservation Act now mandate that homes satisfy energy efficiency requirements. These changes came into effect on April 1st and add more complexity to the permitting process, so it is likely builders rushed to get their permits in March to avoid potential delays as the new BSL requirements came into effect. Total wooden housing increased 44.7% to 51,519 units. Post and Beam homes jumped 44.1% to 38,978 units. Wooden pre-fab starts were up 51.5% to 1,289 units. Platform frame starts posted a 45.9% increase to 11,252 units. Of 2×4 starts, custom ordered owner-occupied homes increased 39.7% to 2,918 units, rentals advanced 52.5% to 7,525 units and built for sale spec homes posted a 16.3% gain to 790 units.
Japan Non-Residential Construction Report for March
Non-Residential Construction experienced a similar surge in activity in March. Total non-residential units grew 42% to 4,570 and total floor area expanded 21% to 3,006,507m2. Wood did even better with starts growing 66% to 1,910 units and floor area jumping 63% to 340,662m2. Again, it is likely that in the case of non-residential starts as well the BSL changes pulled demand forward to an extent. The share of wooden non-residential increased to 11.3% of total floor area or 42% of all non-residential buildings.