Friday, August 25, 2017

Friday Feature Book Review: "Landed": Christopher Dillon (Real Estate Tips) ランデッド: クリストファー・ディロンによる日本の不動産投資

This book is a great starting point for both individuals & institutions new to Japanese real estate. The subject requires solid research like any proper investment. This is confirmed by the CEO of a Japanese developer who says so right on the front cover. Indeed, even local Japanese people would learn a lot from the very distinctive world, that is Japanese real estate. The writing is well suited to those who are adults who have had past experience with various investments including real estate. This is not a simple book for a first time home buyer. The overview is a much wider theme concerned with finding yield and value from passive income and appreciation. 

The best thing about this book is the collection of detailed highlights so unique to Japan. Many of them can really impact price. The details are very well researched and really valuable. Disclosure to prospective buyers is very clear which has rules that need to be respected. However, there are rules and there are guidelines. Some are easy to be worked around but many are not. The author Chris Dillon, helps you feel more confidence with any future purchase in Japan, by clearly researching a wide range of solid reasons.

One great example involves the impact of a death in a condo complex and it impact on price. You learn that if a person dies inside the condo unit, only the new buyer of the unit, needs to be told legally as part of any sale. However, if a person dies in the elevator or common space of the building, every possible buyer of every unit would have to be told. I later learned that owners have been known to move bodies slightly off property after heart attack victims collapse as a result. 

There are so many of these great little colorful tidbits to gain. I have heard such things before and have also heard about how now condo owners sometimes move elderly people who die. They move them nearby just outside the property, in order to avoid these resale price reductions. There are a lot of similar very valuable points for both general real estate investment and Japanese market opportunities in particular. There are only 207 pages of text, but it is all very concentrated and enjoyable reading. This is not a dry text book, but a very interesting way to learn about how to make money in Japanese real estate. You feel a lot of comfort after reading many of the most important dos & don'ts.

Homes, land, new condo or pre-owned, warehouse and offices or stores, all have appeal and can be figured out. One of the best insights contained is how both local and international investors would want very different real estate for very different reasons. This is often reflected in the price, and may touch on some future arbitrage values that may also change over time. The best thing for sure is the lack of restrictions to investors. Any investor with any passport, can buy any real estate in Japan - if they have the cash. 

The Top 3 Takeaways from this book that really impact any reader are:

1) There is distinct real estate consumer with clear local tastes that differ from foreign buyers. Arbitrage can be found if you know what to look for especially with the age of a building.

2) The financial returns of new versus pre-owned real estate has a clear premium for the later. Local investors prefer new, but foreign investors benefit from and prefer resold unit value.

3) The location of one property can also differ in appeal between local and foreign investors greatly. Knowing those differences and taking advantage of them is financially worthwhile.

Unlike most of Asia or Australia, Japan is one of the most open real estate markets in the world. The record keeping of every piece of land or building is extremely detailed and gives amazing detail and comfort to any investor on true ownership. Blockchain technology will be used from Q3, 2018 to improve this process even further. It is getting increased attention from overseas investors, especially from China and Thailand based investors, many of which are looking to make a solid safe yield return. Given that real estate in central Tokyo has increased by 100% in certain areas since January 2013 alone, Abenomic themed returns do seem possible. Now available in ebook form on Amazon & Kobo. Highly recommended.

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