Japan to kickstart inner city price rise
JAPAN aims to trigger a jump in inner-city property prices that could provide an "extremely big" boost to the economy by loosening building restrictions in test zones under Abenomics, a government adviser said.
The changes will make it easier to construct residential buildings in business districts in designated zones, creating opportunities to improve urban planning and make Japan's cities more enticing to employees of foreign companies, said Tatsuo Hatta, a member of a government council on special economic zones.
"Central city property prices will likely rise when various plans are announced," he said in an interview last week in Tokyo.
"In terms of economic impact, the revision related to urban planning in the special zones will be extremely big."
Hatta's comments offer some insight into the government's plans for special economic zones, as investors wait for Prime Minister Shinzo Abe to flesh out his growth strategy, the so-called Third Arrow of Abenomics.
Tokyo's real-estate market has started to rebound as Abe tries to end the deflationary malaise that began with stock and property bubbles bursting more than two decades ago.
Parliament last month passed a bill to establish special economic zones, where rules will be pared in areas from labour to medical care and agriculture, with many details yet to be set.
This year will be "a critical year" for investors to see if Abenomics is taking hold, Goldman Sachs said in a note to investors last week. (Bloomberg)