Land that nobody wants

Japan's govt has a problem: more and more land - that is worthless - with no owners as ageing landowners die and heirs cannot be found

The scenario was a landowner's dream. A new trunk road was coming to Greater Tokyo and a small patch of scrubby grass, good for nothing much else, lay directly in its path. A bit of gumption, an able lawyer and Japan's transport ministry would have to pay up.

In fact, says Mr Uichiro Masumoto of the ministry's land and construction bureau, a stubborn landowner would have been great news. The reality was much worse: there was no landowner. The plot in question was last registered in 1904 to a woman born sometime in the reign of the Meiji emperor.

Bureaucrats burrowed into archives. They ultimately came out with 148 heirs - which was only the start of their difficulties, because eight of them had emigrated. Almost 200 letters and interviews later, the government gave up.

A court order let the road go ahead. The process took three years.

The roadblock is just one manifestation of a growing problem in ageing, urbanised Japan.

Land that was once a feudal treasure, and is still protected by unshakeable property rights, is now so worthless that its owners are running away.

More than 20 per cent of Japan, an area the size of Denmark, has no readily contactable owner. By 2040 the projected area will be bigger than the Republic of Ireland - a spreading nightmare for government, construction and the property industry, because if nobody knows who owns the land then nobody, except for flytippers, can use it.

Forestry roads go unmaintained, solar farms are left unbuilt and taxes uncollected. A private-sector working group on unowned land says by 2040 the annual economic cost will rise from 180 billion yen (S$2.2 billion) to 310 billion yen.

"Up until now, as the population boomed on these cramped islands, every bit of land was precious," says Mr Hiroya Masuda, chairman of the working group and a former governor of Iwate prefecture. "But with the population in decline, there's more and more land with no chance of using it."

The hamlet of Nanmoku Village nestled between mountains in Gunma prefecture. In Japan, land that was once a feudal treasure is now so worthless that its owners are running away.
The hamlet of Nanmoku Village nestled between mountains in Gunma prefecture. In Japan, land that was once a feudal treasure is now so worthless that its owners are running away. PHOTO: REUTERS

Japan's population fell by 403,000 last year. On current trends, it will drop from 126.5 million to 88 million by 2065 and just 51 million by 2115. The decline is fastest in rural areas, with northern prefectures such as Aomori, Akita and Iwate losing about 1 per cent of their people every year.

Ownerless land was a big issue after the 2011 tsunami, says Mr Masuda, as Iwate tried to find space for temporary homes.

He cites his own experience of trying to build a prefectural road only to find an heir had migrated to Brazil in the 1950s. The Japanese embassy in Brasilia drew a blank in its search. "In the end, we gave up and shifted the road," he says.

Small fields in isolated valleys, steep mountain forests in the interior or suburban housing plots in the regions: none of it is worth much any more. "If you own or inherit land, and you've no route to use it, then it's a burden," says Mr Masuda. "You have to pay asset taxes, you have to maintain it. There are more and more cases of people begging for someone to take their land - even for free."

This year, Japan's Parliament will offer its first answer: a law letting public bodies make use of unowned land on leases that automatically renew every five years, with rent paid into trust for any owner who comes forward. That would solve the problem with roads.

But it will not address the underlying issue of land with no identifiable owner, says Ms Shoko Yoshihara of the Tokyo Foundation, a think-tank. "It's not that there's no owner... They're just hard to find."

The roots of the problem lie deep in Japan's legal system. Land registration is not compulsory; rather, it is a civil law procedure designed to let owners protect their property rights and use them as collateral. Land left unregistered is not lost but simply unrecorded.

When all land had value, all the owners registered it. But heirs to worthless parcels of land have no reason to register their interest simply so that the taxman knows where to find them. Add in an inheritance law modelled on France and Germany, which gives all children a statutory share of their parents' assets, and land ownership quickly becomes hopelessly opaque.

Compulsory land registration is an option under government consideration.

Ms Yoshihara doubts even that would solve the problem, however, given the costs involved. "Even if it were a duty - if it doesn't make financial sense, will everybody obey the rules?" she asks.

The ultimate answer may involve something more profound: a fundamental shift in how the Japanese people relate to their mountainous island home.

"Until 30 years ago, people thought of land as the greatest asset of all, something that always rises in value," says Mr Masuda. "With the fall in the population, the attitude to land has been transformed. But the system hasn't evolved with it. What we need isn't a minor change, it's a full model shift."

Such a shift could involve what Ms Yoshihara calls a "receptacle" for Japan's unwanted land. "When an elderly person owns a mountain or a field, and their children have moved to Tokyo, we need to provide more options," she says.

NO TAKERS

There are more and more cases of people begging for someone to take their land - even for free.

MR HIROYA MASUDA

At present, local governments usually refuse to accept gifts of worthless land, because of the legal liability and management costs that come with them. They could be obliged to take it, however, or the government could set up a public body to hold land. That could turn a problem into an opportunity.

In an ever more crowded world, what could the nation do with new swathes of public land?

"We've always had the principle in Japan that land should be privately owned - that it should belong to someone - but we may have to transform that to something else," Mr Masuda says.

Japan's environment paid a heavy price for its decades of rapid industrialisation. Almost every place on the islands is touched by human activity. Strong private property rights, laissez-faire development and an addiction to infrastructure projects led to cheap apartments and factories springing up in even the quietest mountain valleys.

"If we can gather together as much of this land as possible in some kind of public body then we can make a big contribution to the environment," says Mr Masuda, citing the potential for nature reserves or forestry carbon sinks.

That would make Japan a different kind of place.

For Mr Masumoto at the transport ministry, it will be enough simply to avoid cases such as the former cemetery owned by 40 people - or rather by their 240 heirs. Three of them are still missing. The acquisition process has lasted more than two years. The negotiations continue.

FINANCIAL TIMES

A version of this article appeared in the print edition of The Sunday Times on January 21, 2018, with the headline 'Land that nobody wants'. Print Edition | Subscribe