Japan's political reform in doubt

The latest news from Japan suggests that the chances of reform under the current PM Yukio Hatoyama are quickly deteriorating. The Democratic Party of Japan lost a local election in Nagasaki. I consider that less important considering that their candidate was a bureaucrat, and he was beaten by the Vice Governor. The more important issue is opinion polls, which are being shaped by the financial scandals. They have a few months to turn those fears around, otherwise we are looking at a 'hung parliament', which is not the best basis for reform. See the full story here. Ideally I would like to see the DPJ given a majority in both houses in the June 2010 elections.

NZ Property Guide
Philippine Real Estate Guide
Foreclosed Japan Guide

Philippines property ranks highly on yields and forex rates

I'm in the process of updating my Philippines Property Report. This will be the 2nd edition. A part of this report is helping prospective retirees, investors and expats to find investment opportunities in the Philippines. We do this for our own benefit as well as yours. The focus of this blog is exchange rates. The Philippines peso has tended to suffer along with the USD, though it has generally fared better. Click on the charts to the left and it will be apparent that foreign or Filipino investors holding Australian dollars, Canadian dollars or US dollars are in a pretty good position to invest in the Philippines. The same is true for expatriates or Japanese people holding Yen. The Yen is also trading a favourable exchange rate to the Philippines. The attraction of investing in the Philippines is particularly attractive given the better than average yields - 2nd only to Indonesia in East Asia at 9% per annum according to Global Property Guide. Investing in the Philippines makes less sense for Europeans given the weaker Euro, but having said that, its far easier for foreigners to raise finance in the Philippines than other countries. Some people take out loans in their partners names. Its even easier if you are buying foreclosed assets because some of the banks will not require proof of income. The implication is that even Germans, French, Dutch and other investors can buy property in the Philippines with the expectation of paying off the loan when the currency is optimal.


NZ Property Guide
Philippine Real Estate Guide
Foreclosed Japan Guide

Buying foreclosed property in Guam

I don't offer any particular information about buying foreclosed property in Guam, but in the process of researching for my 2nd edition Philippines property report, I note that the PNB-Allied Bank of the Philippines have a listing of foreclosed property in two locations in Guam.
I thought this property might interest people because I've previously met an Australian military retiree who was moving to Guam to live with his Filipino girlfriend. He had been in the military for 10 or 20 years, thereafter apparently they get a lifetime pension. Seems like a good deal for someone who saw no military action. Anyway, for anyone interested the details are here. I have not been to Guam, but it might appeal to American servicemen as well. The idea of being stuck on an island might appeal to others. I don't imagine the flight connections are very good either.

NZ Property Guide
Philippine Real Estate Guide
Foreclosed Japan Guide

Cheap tickets NZ to Japan

Are you a New Zealander interested in investigating foreclosed properties in Japan? Well there has never been a better opportunity to fly to Japan. Air NZ is offering discounted tickets:
1. Two tickets from Auckland to Osaka - see TradeMe
2. Two tickets from Christchurch to Tokyo - see TradeMe

The bids on these tickets are currently around $420 for two tickets. You could be reading my book on the plane. :) Any option is a good deal. Have a look at the other flights on offer. Of course you have to depart from NZ.

NZ Property Guide
Philippine Real Estate Guide
Foreclosed Japan Guide

Best buying in Japanese foreclosed property

We have just released our Japan Foreclosed Property eBook (3rd edition). For those of you not aware, this is probably going to be the best 2 year period for buying foreclosed property. There are three compelling reasons:
1. The Japanese elections in mid-2010 could result in the Democratic Party of Japan holding a two house majority in which to make substantial reforms.
2. The Japanese public debt has reached a point (200% of GDP) at which it is going to struggle to raise money. It has been forced into a corner. Going to the international market would mean much higher interest rates. It has to reform and slash costs. The DPJ is waiting for that election. It needs a majority in both houses.
3. The high public sector debt essentially places a ceiling over Japanese interest rates for the next 5 years, if not longer.

The implication is that you are going to have low interest rates looking forward, and you are going to see reform which boosts real incomes. These rises in income will flow through to asset prices like property and equities. Want to know more about the Japanese foreclosed property market.... all is explained in the following Japan foreclosed property report. Why rent in Japan when high yields favour owning property. You can buy a house for as little as 1-3x your annual income.... if you buy in the suburbs like Sakado (less than 1 hour from Tokyo).

NZ Property Guide
Philippine Real Estate Guide
Foreclosed Japan Guide

Would I recommend retiring in Japan?

Someone asked me the other day whether I would recommend retiring in Japan. The person was from the Philippines, so they were already living in Asia, and wondering if Japan would be any better. My response to that depends on the type of life you are after, and your adaptability. Japan does have some very favourable advantages, though given the low cost of property in both countries, I see no reason why some of you could not consider a life in both countries for the reasons mentioned in other posts - such as the Japan Rail Pass, not to mention the cheap flights form the Philippines (Clark, Manila) to Japan (Osaka, Tokyo, Nagoya) - as little as Y4000 ($80) with Cebu Pacific in sale season. Read the Philippines Inquirer for details.

The benefits for retirees in Japan are:
1. Cash card - Its easy to draw on a foreign savings account from any Japan Post Office. All of them have access to the global Mastercard/Visa network (Cirrus-Maestro) now.
2. Safety - Japan is the fastest country in the world. Break-ins are not common, and it is a harmonious place, so little treat violence. Youngsters tend to be respectful of older people, so they also tend to be helpful.
3. Food: The food is very good. Its healthy; there is a lot of variety. It might not be the cheapest place to buy food, but older people eat less anyway, and tend to interact with people in the community. It would help to have a group of friends in your community, particularly to help with utility or getting a tradesperson.
4. Forums: There are very supportive forum communities in Japan where you can obtain really good advice from people in the same situation.
5. Culture: Living in Japan is a chance to experience another culture - a culture far different from any other. The place is unique. I tire of the shopping malls in the Philippines with their generic malls. Japan offers many fresh and interesting experiences.
6. Transport: You will unlikely require a car in Japan. A bicycle and bus is sufficient, though a car makes sense in rural areas. A scooter is a good idea too as Japanese people are very considerate of bipedal mode. The clear benefit is the Japan Rail Pass for non-residents. You can see a lot of Japan on these passes.

I don't see medical facilities as a big obstacle, though clearly before you settle somewhere you should ensure there is a local doctor who speaks English. It would also be helpful to have an English-speaking companion to translate your symptoms into Japanese. I suspect most doctors would know a lot of English because they attend conferences. This is particularly true for city doctors. I think you would only want emergency services if you are old or unhealthy. If you are relatively young, or need some delayed treatment, you can always fly to the Philippines for more expensive medical care. The services there are fantastic.

The obstacles are likely to be:
1. Language: Older people are less inclined to learn new languages, though if you have time, there is nothing stopping you trying. In any respect, Japanese people are surprisingly good at English...at least understanding it. In most cases, they just lack confidence in speaking. I never bothered to learn. I simply use sign language. Language is particularly a big problem setting up your home. When I first moved there is was a 6mth adjustment, and I did have issues with technical issues like routing emails through my cell phone. Foreigners are frowned upon by some telco technicians because we demand a higher level of service because we don't speak technical Japanese.
2. Cost of living: Japan is more expensive than a lot of countries. This is true for food, entertainment, eating out at up-market restaurants. Utilities are very expensive, but then so is the Philippines for many things, and the service is far poorer.

The ease of living in Japan also will depend on your adaptability and your ability to make friends who can help you with any obstacles. This is of course most difficult when you first arrive in Japan, to buy the property, and to finally settle there. After those challenges...all becomes routine. Living abroad is becoming for popular. Retiring abroad is also on the increase since people have decided that life is about experiences - not dying in some familiar place.
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Andrew Sheldon www.sheldonthinks.com
http://foreclosedjapan.sheldonthinks.com/

Cost of property in Japan

The cost of property in Japan - like anywhere else - varies considerably. Most people would be surprised by just how cheap property can be, as well as how expensive. The most expensive property is of course in the central Tokyo. It is typically those areas with expensive, exclusive homes, or otherwise those areas with exceptionally good subway connections or convenience to sought after districts like Roppongi, Shibuya, Shinjuku, etc. The cost of the most expensive properties is hardly worth mentioning. Any city property is a 'growth asset' so if you are able to find a place with a yield over 8% you are doing well. This is particularly the case in the cities because increasingly Japanese elderly people are retiring in city areas.

At the other end of the spectrum property in rural areas can be as cheap as $10K. Be careful to examine exactly the nature of the type of property. Are you leasing the land, or is it freehold title? I have been able to find some exceptionally cheap property in rural areas. I have even heard of people been given houses to remove the owners of the 'tax burden'. In depopulating Japan these properties are particularly attractive to foreign tourists who want to take regular holidays. What is the appeal? I can think of several benefits:
1. Low cost of property - under $30,00o for a decent place
2. Low government taxes - I pay just Y30,000 (US300) a year
3. Proximity to services - Japan is frowned upon for its population 'crowding' but thats only the east side of the country. The west is not so populated and has wonderful wilderness areas.
4. Japan Rail Pass - One of the reasons I know about Japan so much is because I have made great use of the Japan Rail Pass over the years. Very good value for foreigners (tourists only, not residents). Why would you want to reside in Japan? Just have extended holidays there.
5. Activities - Japan has a great array of activities.
6. Safety - Japan is without question the safest place to live, or to hold property. I don't even bother insuring my place. Mind you the place could burn down and the property would still be worth more than I paid. :) That is the benefit of buying foreclosed property.

If you are looking for a place in Japan, I'd recommend something close to Osaka, Tokyo or Nagoya so you have easy access to international flights. If you are looking for semi-rural property, something in the Mito area, or Saitama prefecture would be fine. If you are looking for something in more wilderness areas, I'd avoid the colder Western side of the country and find something in Wakayama prefecture, or Fukushima area. The colder NW is cheaper, but probably not a desirable place to live. As far as city living goes I like Tokyo for the 'plethora' of choice in facilities and its gaijin culture, and Fukuoka is great because of its relaxed, friendly style. Every time I go to Fukuoka I have a great night.
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Andrew Sheldon www.sheldonthinks.com
http://foreclosedjapan.sheldonthinks.com/