Newsletter No. 8 looks at collapsing buildings in Hong Kong, Airbnb in Japan and beyond, changing living arrangements in the United States, advances in solar power technology and much more.
The Landed Newsletter highlights news and resources that you can use to make better real estate decisions, whether you are buying, renting or investing. With a focus on Asia and the Pacific rim, the Landed Newsletter covers trends, legal and environmental developments and technology.
All New South Wales homes with a swimming pool that are sold or leased after April 29, 2016, are required to have a certificate of compliance, which can take several months to issue.
In a new report, the Organization for Economic Co-operation and Development warns that Canada is at risk of a “disorderly housing market correction.” The report cites rapidly rising prices in Toronto and Vancouver as a cause for concern.
Urban Futures has compiled a list of per capita public debt for Canadian cities. Surprisingly, St. John’s tops the list, while Saskatoon is at the bottom. Toronto and Vancouver are near the middle.
In Vancouver, an academic has calculated that the increase in the value of single-family homes last year surpassed the value of all employment earnings in the city. Meanwhile, the media reported that the most expensive home in Vancouver—a C$31mn (US$24 mn) mansion—is owned by a "student." Clearly, we are getting close to the top of the market.
Tensions continue to mount in the South China Sea (SCS) as China intercepted an American spy plane and a warship, the Pentagon claimed China has reclaimed more than 3,200 acres of land in the SCS and China said it will not accept a United Nations’ ruling on its territorial claims in the SCS unless the UN upholds those claims.
In addition to its geopolitical significance, this conflict could hurt investors in Asian real estate. It also has the potential to influence the US market, where—for the first time—Mainlanders eclipsed Canadians as the top foreign buyers of American real estate.
In May, new home prices in China's 100 largest cities rose an average of 10%, year-on-year. It was the 10th consecutive month of increases, with second-tier cities showing strong gains.
May saw three blows to Hong Kong's reputation as a safe, well-regulated housing market, with the collapse of a 1,400-square-meter green roof at City University in Kowloon and a 10-meter-high wall at the site of the former Victoria Prison in Central. There were no fatalities in either incident. At the end of May, an independent panel released a redacted report on the lead-tainted-water scandal at the city's public housing estates. The panel called the scandal a “classic case of buck-passing,” while Chief Secretary Carrie Lam Cheng said that she had not found any evidence that an individual government official was responsible.
In a rare move, the Housing Department started proceedings against the owner of an industrial property that had been illegally converted to residential use. The premises was the site of a murder, so people living in industrial buildings probably have little to worry about, for the time being at least. For more on industrial conversions in Hong Kong, see this presentation.
Housing-related fraud is increasing in Hong Kong. More than 400 homeowners, many of whom are in financial distress, have been cheated out of HK$320 million (US$41 million) by scam artists posing as middlemen arranging low-interest loans. Con artists also used fake ID and land titles to defraud finance companies and buyers out of HK$227 over the past three years.
The Hong Kong government is preparing to introduce a licensing program for property management companies that will be run by a new statutory regulator.
Developers continued to offer incentives on new homes. Wheelock sold more than 300 units in its Savannah development in Tsuen Kwan O at discounts of up to 19.5%, while Cheung Kong and Henderson offered mortgages of 80% and 95%, respectively, on certain projects.
Prime Minister Abe has delayed an increase in the consumption tax, from 8% to 10%, until October 2019. The tax increase, which was originally scheduled for October 2015, was postponed until April 2017.
Japan’s fertility has reached the highest level since the mid-1990s. The increase is encouraging, but it's not enough to reverse a decades-long decline.
A Japanese government body has proposed allowing homeowners to take in fee-paying guests for up to 180 days a year without a hotel license. If they are adopted, the new regulations would be a significant boost for Airbnb and similar businesses. Meanwhile, security companies in Japan have begun catering to Airbnb hosts with multilingual call centers, emergency support, smart locks and similar services.
The House of Sugimoto is a video exploring traditional Japanese architecture and house-building techniques. It’s also 25 minutes well spent.
Trends and Ideas
People who suspect their neighbors are acting as Airbnb hosts can now file a complaint directly with Airbnb. Meanwhile, cities in Germany are setting up "snitch lines," where residents can turn-in neighbors illegally renting their homes to tourists.
Social and economic changes in the United States are being felt in the housing market. Wharton examines the rise of multi-generational homes, The New York Times looks at men in their 30s sharing apartments and The New Yorker takes on co-living startups.
A paper (PDF) in the journal Environmental Research Letters blames man-made climate change for the disappearance of ﬁve of the Solomon Islands between 1947 to 2014. Six more islands are reported to be under threat.
Google has introduced Home, a small speaker/microphone combination that will answer questions, play music and control home automation. A price has not been announced for Home, which will be available later this year.
Vulnerabilities in Samsung’s Smart Home automation products let hackers digitally pick the system’s door locks.
How long should it last?
The International Association of Home Inspectors has prepared a chart listing the estimated life expectancy of home appliances and the components that comprise a home, ranging from countertops and windows to smoke detectors and solar panels. It’s a helpful tool for making repair-or-replace decisions.
Thirty-seven more cities have joined the Rockefeller Foundation’s 100 Resilient Cities program, which gives municipalities resources to help them become more resilient to physical, social and economic challenges. New participants in Asia include Jakarta, Kyoto and Seoul.
Researchers at the University of New South Wales in Australia have created a photovoltaic cell with sunlight-to-electricity conversion efficiency of 34.5%, more than 10 percentage points higher than previous designs. Efficiency gains like this pave the way for smaller, more powerful rooftop solar power arrays.
Engineers at Japan’s Kyocera are planning to install floating solar panels on a reservoir in Chiba Prefecture, near Tokyo. The installation, which would generate enough electricity to power nearly 5,000 homes, would also retard water evaporation and the growth of algae in the reservoir.
Misaligned mirrors are being blamed for a fire at the world’s largest solar plant. The Ivanpah Solar Electric Generating System is located in California's Mojave Desert.
I will be speaking at an event in Tokyo in late July. Details to follow.
Newsletter No. 8 was published on June 2, 2016.