The number of private housing in Japan decreases with the loss of demand due to the virus

The number of private properties to rent for vacations in Japan has declined as the novel coronavirus pandemic has driven demand for travel down, dashing hopes of more foreign visitors during the Tokyo Olympics and Paralympics.

As of July 12, there were 18,578 vacation rental homes and apartments registered under the country’s private accommodation law, up from a peak of 21,385 in April 2020, according to data released by the Japan Agency for tourism.

Photo taken in June 2019 shows a private “minpaku” accommodation room in Kanazawa City, Ishikawa Prefecture, central Japan. (Kyodo)

In fiscal 2020 through March of this year, a total of 1.14 million people stayed in these private dwellings, down 77% from the previous year.

Private accommodation, known in Japan as “minpaku”, has gained attention since a law legalizing it came into force in June 2018 to address the lack of hotel rooms amid boom of inbound tourism.

Prior to the global spread of COVID-19 in early 2020, there were concerns that there would be a housing shortage during the Tokyo Games, especially in Tokyo, Osaka and other major cities, leading to an increase in private housing recorded at a rate of several hundred units per month.

The Tokyo Olympics and Paralympics, originally scheduled for summer 2020, have been postponed for a year due to the pandemic. The decision to hold the Summer Games mainly without spectators to prevent the spread of the virus has hit private accommodation operators.

Of the 289 hosting operators who reported their business shutdown from September to October 2020 and responded to a survey, 49% said they could not expect to make any profit.

With the disappearance of foreign tourists, the main customers of minpaku’s facilities, operators see no sign of a recovery in tourism demand.

The government’s “Go To Travel” campaign for domestic tourism subsidies, covering private accommodation, has been on hold nationwide since December 28 due to a resurgence in coronavirus infections.

Some local governments have their own travel discount campaigns, but these are limited to hotels and hostels and do not cover private accommodation.

The government plans to conduct an investigation by March of next year into the system for the use and management of vacation rentals, with a possible review of the accommodation system for a resumption of travel demand. post-pandemic.

The elements to be considered by the envisaged review would include legal restrictions, such as limiting the accommodation offered by private accommodation to 180 days per year.

While vacation rentals allow for longer stays at lower prices than hotels and hostels, they also use vacant rooms and homes in areas of Japan that are experiencing declining populations.

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