I was looking at a YouTube video of a Japanese guy talking about his financial situation in Japan, when I stumbled across him saying that his rent for his apartment was the equivalent of $651 a month.
He lives in Tokyo. This is not some cheap place to live. Tokyo was considered the most expensive city in the entire world to live in the 1980s.
I don't know about you but $651 seems like a wonderful bargain price to me. If I could find a one-bedroom apartment for $651, I would immediately grab it. This would be very reasonable.
You try to compare the rent in any decently sized American city, it is much higher than this.
He says that $651 rent includes gas, water, and electricity, and Wi-fi internet connection.
Now, Japanese living spaces tend to be pretty small and compact by American standards, but he said in the video that his apartment was pretty spacious for one person. He does say he found a great unit.
He also shows a quick video pan-around of his living space, and it looks pretty good by Japanese standards. By American standards, I think it would be considered a small compact apartment, but not too tiny. It has a little entry hallway, a bathroom, a narrow living area openly connected to the kitchen, and one bedroom.
He paid 69,000 yen (equal to US$651 per month) for the apartment. His starting salary just after graduating for college, and after taxes, is $2,025 (which works out to be $24,300 a year). He says this is pretty average.
HOW MUCH A JAPANESE FRESH GRADUATE MAKES IN JAPAN, August 2, 2020, SHUNchan
So why is the cost of rent so much higher in America than Japan?
I believe it has to do with the people. The population in the US has been rapidly increasing over the last several decades, due to high levels of immigration. This is also the case in other countries like Canada, Australia, and many countries in Europe. This has created an imbalance of people to available housing. Creating a housing shortage. When there is a housing shortage, and new buildings start having to be built, it drives the prices up.
In Japan, by contrast, they have a much stricter immigration policy. The population in Japan has actually been decreasing due to people having fewer children. (In fact, Japan's population has been decreasing more than any other developed country)
What this does, I think, is leaves open housing space. So with more availability, prices go down.
It's gotten to the point where in many parts of America the young generation can't afford to go out living on their own because the housing prices are too high. Or if they do go out on their own, they have to cram together into a small shared space with a roommate, and even then they are in a precarious situation where they struggle to afford the cost of rent, and they likely could find themselves having to move back to their parents if anything goes wrong.
If the cost of rent for a one-bedroom apartment was only $651, that would be much more reasonable, then I think they could afford to live on their own.
(Now, just a quick disclaimer, I don't necessarily recommend you try to go live in Tokyo. This price is for Japanese people. They can be very reluctant to rent to foreigners, so the rents may likely be higher, or the options available to you will likely be much more limited to the less desirable areas with more noise)
So you notice anything here? American middle class birth rates are going down because the younger generation can't afford housing space and they are postponing and not starting families. (Remember, it's the younger generation where most of the children come from)
But housing prices are going up because population is being brought in from outside, from other parts of the world.
In a way, it's almost like bringing in one group of population is displacing another group of population from being born.
As if the economy and demographic population pool is seeking to reach some point of equilibrium. More people, conditions become more difficult to start families, fewer children.