Flat 35 Home Loan Report for 2018

On July 12, the Japan Housing Finance Agency released its annual report on Flat 35 home loans. The report gives us a look at what type of homes people are buying and how much they are spending on them. Let’s take a look at some of the interesting changes in borrowing that have taken place over the past 10 years.

For second-hand apartments, the average age of a borrower was 40.9 years, with an average household size of 2.4 persons and an average annual household income of 5,855,000 Yen (approx. 54,000 USD). The average apartment size was 65.90 sqm (709 sq.ft). This is the sixth year in a row to see a shrinking floor size. In the greater Tokyo region it was 62.90 sqm (677 sq.ft).

The average price was 29,825,000 Yen (approx. 276,000 USD). The average loan was 84.6% of the purchase price. 

Apartments purchased are getting older, with 11.8% of second-hand apartments over 41 years old. In 2008, apartments of this age accounted for just 0.2% of the total. Apartments under 10 years old represented 18.1% of the total, down from a 49.8% share in 2008.

For detached second-hand homes, the average floor size was 111.70 sqm (1,202 sq.ft). This is the fourth year in a row to see a decline. The average age of a borrower was 42.2 years, with an average household size of 3.2 persons and an average household income of 5,030,000 Yen. The average purchase price was 24,733,000 Yen, and the average loan was 86.2% of the price. 

Houses between 21 ~ 30 years old have increased from a 17.1% share in 2008 to a 30.7% share in 2018. Houses between 31 ~ 40 years old have increased from a 3.6% share in 2008 to an 11.8% share in 2008. Meanwhile, houses under 10 years old represented 24.1% of the share in 2018, down from a 34.8% share in 2008.

The Flat 35 home loan program was introduced by the government-backed Japan Housing Finance Agency in 2003. The loans provide full-term fixed-rate mortgages to home buyers and are offered through many retail banks. 

Source: Japan Housing Finance Agency, July 12, 2019.

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