The Neyagawa City Council in Osaka approved an ordinance on July 9 to impose a new tax on unoccupied residential properties [1], [2], [3].
This measure aims to force the circulation of stagnant real estate to secure housing for younger generations and increase the city's overall population [1], [4], [5].
The new "vacant home tax" will target owners of properties that lack actual residency and are not being rented or slated for sale [1], [3]. Under the approved plan, the city will levy a tax equal to 35% [1], [3] of the standard fixed asset tax on these properties. Local officials estimate that approximately 6,400 homes [1] will fall under this tax bracket.
Mayor Keisuke Hirose said the city is facing a situation where there is no capacity to accommodate the younger generation [4]. He said that the city intends to encourage the effective use of these properties to solve the housing gap.
Implementation of the tax is scheduled to begin in 2029 [1]. The city believes that by increasing the financial burden on owners of idle land and buildings, owners will be more likely to sell or lease their properties to new residents.
Hirose said he hopes the move will cast a stone into the national problem of vacant homes and help provide a solution [1].
The decision comes as Japanese municipalities struggle with an increasing number of abandoned properties left by aging populations or heirs who live elsewhere. By penalizing the decision to leave homes empty, Neyagawa seeks to revitalize its urban landscape, and attract new families to the region [1], [2].
“Younger generations have nowhere to go”
Neyagawa's approach represents a shift toward aggressive fiscal policy to manage urban decay. By creating a direct financial penalty for property hoarding, the city is attempting to artificially stimulate the real estate market. If successful, this model may be adopted by other Japanese municipalities facing similar demographic collapses and housing shortages for young adults.
