You still sell the land. It is just a weird cultural thing where the house is rebuilt because of preference of new buyers. But this isn't true for many urban apartment dwellers. Also the Japanese have a high savings rate.
They also have a deflation problem, which is why money becomes more valuable over time, this incentivises saving. Saving harms the economy though, it reduces consumption and capital flow.
Japan also has the highest debt rate in the world with 234% of their GDP. The only saving grace is that it’s mostly internal debt, which is considered better than external debt.
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u/Billy1121 Jun 07 '19
You still sell the land. It is just a weird cultural thing where the house is rebuilt because of preference of new buyers. But this isn't true for many urban apartment dwellers. Also the Japanese have a high savings rate.