Reestablishment of the Housing Safety Net

ABSTRACT

The major four components of the current housing safety network are public housing, the Urban Renaissance Agency’s rental housing, special high-quality rental housing, and high-quality rental housing for the elderly. It is a policy that provides different housing depending on the target recipient, but because of a strong sense of unfairness regarding the move-in process, inefficiency, such as housing vacancies in some areas, is conspicuous. As Japanese society continues to age, how the housing safety net system will be reestablished becomes a more pressing question.

The systems for the various public rental housing programs should be unified, and the target recipients should also be standardized. Specifically, those in the lower 50% income bracket should be given the same housing qualifications for public rental housing. Among these, those in the bottom 25% income bracket as well as those in the lower 40% income bracket who are raising children or are elderly would receive preferential rent treatment. Rent would increase in proportion with increases in income, and once income has reached the ceiling for preferential rent treatment the rent would be set at the market value. This would make it possible to use the stock of housing more effectively, while also ensuring more fairness than that of the current housing selection process.

Moreover, as a general rule the rebuilding of the housing stock would only be done using private capital such as PFI. At the same time, private rental housing that meets certain requirements should be made available as public rental housing, and support should be given in order to increase the number of private rental housing that meet such requirements. (For example, in the event that construction is done with securitization, the Urban Renaissance Agency would purchase a portion of the stocks). If the establishment of a private rental housing market is promoted in this way, the housing safety net system could be changed from direct provision to a rental aid (voucher) system in the future.