Lifestyle and Demographics

Articles published in Akiya Lab | Roopt (Makigumi)

Makigumi, which operates Roopt, regularly researches case studies and other information regarding the revitalization of vacant houses and publishes them as columns.

New Lifestyles and Changes in Real Estate Valuation

Modern society is experiencing significant changes in traditional real estate values due to demographic shifts and diversifying lifestyles. Especially in rural areas, with declining populations, the demand and yield for new properties are no longer as promising as before. The rapid decrease in the younger generation and the increase in non-nuclear family living arrangements are major factors changing the criteria for real estate valuation.

Real Estate Valuation Adapting to Lifestyle Changes

As divorce becomes more common, and if couples cannot adapt to subsequent changes after starting a life together, the burden of loans is increasingly becoming an issue. Such societal changes are leading to a reevaluation of excessive reliance on new properties and a movement to find value in used properties and properties that cannot be rebuilt.

The trend of accepting "living in a used property for 20 years" with the same sense of security as a new build indicates real estate valuation standards based on new lifestyles. This idea aims to evaluate real estate on a more level playing field, rather than solely based on whether it is new or if the buyer is a company employee.

Differences in Valuation Between Buying and Renting

The valuation of a property differs between buying and renting. When considering purchasing an old property versus renting one, the general consensus is that renting can offer greater value. This is because the utility value of a property in the rental market is evaluated more flexibly than in the purchase market.

While it was common to arrange full loans for new properties or individuals with good credit, there is now a demand to correctly evaluate the actual utility value of properties, whether they are 10 years old or 50 years old. It is important to assess and appropriately value a property's utility regardless of its age. The cost of renovation should also be included in this evaluation, as it is now an era where the true value of a property must be determined.

Summary

Demographic shifts and diversifying lifestyles are major factors changing real estate valuation standards. There is a need to move beyond preconceived notions about new properties and to find value in used properties and properties that cannot be rebuilt. A flat evaluation based on actual utility value, regardless of whether the property is bought or rented, will become the new standard in the future real estate market.

First published: Akiya Lab (2024 - now integrated into this site)