Japan's Challenge: Replacing Tiny `Rabbit Hutches' -- Crowded Homes Frustrating, Embarrassing

TOKYO - Takashi Hamada's apartment is not so small that he has to go outside to change his mind. But he will leave to speak on the telephone.

If his two young sons are playing noisily and he wants to have a real conversation, there is no place to hide in the condominium's three tiny rooms. Hamada will grab his cellular phone and go out into the street to make a call.

The size of the average home is a continual source of frustration and embarrassment to Japan, which is otherwise one of the richest countries in the world. Japanese homes are typically less than half the size of American homes and cost two to three times as much.

While the American middle class considers the three-bedroom home a birthright, the typical Japanese family like Hamada's scrunches into space not much bigger than a two-car garage.

Providing adequately sized housing is the last major challenge left for Japan's modern economic miracle, but the incredible expense will make progress difficult.

High land prices

In the Tokyo metropolitan area, where 35 million people live, overcrowding has led to some of the highest land prices - and tiniest houses - in the world.

"Nobody can solve this problem; it's our fate," said Yasuo Masai, a planning expert at Rissho University. "People in poorer countries are better off."

Hamada, 34, who works in his family's diamond business, paid $400,000 for a high-rise condo with total living space of about 15 by 40 feet. That includes a cramped eat-in kitchen, one bedroom that they all share and a third room that is a combination children's play area, study (the family computer) and living room (with a couch and TV).

The apartment's size dictates the family's schedule. They tend to keep their two sons, ages 4 and 2, awake until 10 or 11 o'clock at night rather than tiptoe around all evening.

"I dream of living in a home with an upstairs and a downstairs," Keiko Hamada said.

The Japanese have long acknowledged that cramped housing puts a major dent in their standard of living. During a diplomatic row about 15 years ago, a piqued European official disparaged the Japanese for living in "rabbit hutches." Rather than being insulted, the phrase has stuck among the Japanese as an in-joke and a motivational image for improvement.

"When you think of Japan in terms of economic power and personal income and then look at the housing situation, it's backward," said Hiroshi Oshima, a housing-policy expert at the Ministry of Construction.

Result: fewer children

The repercussions of inadequate housing are profound. Small living space is a major reason the Japanese don't have more children, which has led to the country's undesirably low birth rate. The myth of Japan Inc. is based partly on the super-long working day, but many men acknowledge they are simply in no hurry to race home at night to hear their children's crying echo through a tiny apartment.

The Japanese government has massive plans to try to increase the average size of a dwelling. Tokyo's master plan calls for spending as much as $20 billion in the next decade on the construction of larger apartments and houses, said Yoshihiro Yamamuro, a Tokyo metropolitan-government housing-policy official. Some of the units are government-built, and others are developed privately using government incentives to benefit both builders and renters.

To alleviate congestion and free up space for development, the government is also talking about spending more than $100 billion to move some or all of the national capital out of Tokyo.

Along Tokyo's Sumida River stands one new high-rise where 27-year-old Hiroe Kozawa lives with her husband, a banker. Their $2,000-a-month apartment with sweeping views of the city was built through a government program and meets the government standard for a family of two.

But the nicest adjective to describe the apartment's size is cozy. It has two tiny rooms - a living room and bedroom.

The galley kitchen is closet-sized, and there is almost no cabinet space, so Kozawa keeps all but her everyday dishes stored in boxes. Everything else that doesn't fit in the apartment gets stored in the trunk of her car.

"I don't keep things," she said. "Even if there is something I want to buy, I don't."

But people like Kozawa who live in nice new buildings don't complain; the average older apartment is even smaller.

Mountainous Japan has always been a crowded country. Only 20 percent of the land is inhabitable, less than in Switzerland.

One room with straw floor

To make the best use of limited space, many homes - like the Hamadas' - have at least one room with a straw, or tatami, floor. During the day it's a living room where the family sits on the floor at a low-slung table to drink tea and converse. At night, the table is put away, futon mattresses are brought out and everyone sleeps on the floor.

Space problems have been exacerbated by high land prices, which will have to drop before homes can become larger.

In fact, prices have plummeted since the boom times of the 1980s ended. But prices are still too high, the result of a "myth" that land prices would always rise at a faster clip than economic growth, creating an unhealthy focus on speculation, said Tokunosuke Hasegawa, a real-estate professor at Meikai University.

Hasegawa said one of the few ways to reduce prices and create demand for larger homes would be for the government to release land held for rice growing and import more rice. That would be nearly impossible, given the political power of farmers and the cultural significance of rice.

"Its a miserable situation," Hasegawa said. "Take me: I don't even have enough space in my apartment for a study. So I have to come to the office every day."