Sumitomo Forestry Co., Ltd. and Mitsui & Co., Ltd. recently announced their participation in the housing interior business in China. Units in housing complexes in China are usually received by customers in a “bare shell” condition in which the concrete floors and walls are exposed so that the customers can freely design the interior finish. In recent years, the supply of housing with completed interior finishing as in Japan is on an increasing trend, and Sumitomo Forestry and Mitsui will provide Japanese-style interior design, construction technology, and know-how to its business partner in China and will work to spread comfortable, safe, and worry-free housing with space-saving features through this interior business. By providing technical guidance, Sumitomo Forestry will work to improve the advantages and competitiveness of its business partner in China. With 20 years of experience in the lumber and construction material business in China, Mitsui will work to understand the local housing needs directly through the interior business and to use the information and knowledge to create new housing-related businesses in China.
The Real Estate Companies Association of Japan recently held a board of directors meeting where it determined and completed “Tax Reform request for fiscal 2016”. The association will submit it to concerned ministries and agencies. In one part of the request, “Essential tax system for the development of high-quality housing stock”, a request was made for a extension of the application period of special provision such as a reduction of fixed asset tax related to newly built housing and provisions concerning long-term & high-quality housing, certified low-carbon housing, real estate income tax for housing acquisition, and others. As for “Comprehensive support for various housing needs”, plans were made to expand various support measures for three generations living together and to reconsider requirements for floor area, in order to support acquisition of housing that excel in terms of health and environment for single households and the elderly. For “Responding to the consumption tax rate hike”, a request was made for “the application of a reduced tax rate for housing acquisition”. Concerning this item, the request was explained as, “Housing is a societal asset that becomes the foundation of people’s lives, and it is different from mere consumer products. The price of housing carry an extremely high price, and when the consumption tax rate increases, the burden on home buyers also becomes extremely heavy. In addition, housing investment is a pillar of domestic demand, and the economic ripple effect is also large, so the impact on the Japanese economy by a rush-in-demand and its reactionary effect is enormous.”
Japan is entering the stage of putting to use the man-made forests that were afforested after the Pacific World War. With regeneration cutting (clear cutting) expected to increase in the future, planning for the stable supply of seedlings that are necessary for reforestation has become essential, but in actuality, production of seedlings has not kept up with demand. Looking at the supply and demand outlook for seedlings, demand is exceeding supply for every type of wood, and the shortage is expected be a total of 5,733,000 seedlings in fiscal 2015 and 6,010,000 seedlings in fiscal 2016. Looking in detail at the amount of shortage in fiscal 2016, cedar will have a shortage of 3,983,000 seedlings, and for coastal reforestation, Japanese black pine will have a shortage of 1,224,000 seedlings. A reduction in the surface area of man-made afforestation and the number of seedling growers following this decrease are seen as the main factors for the shortage. As support measures related to the expansion of seedling production, “Funds to build a forestry foundation for the next generation (newly appropriated total of 20.0 billion yen)” in the budget request for fiscal 2016 will give assistance to facilities and equipment such as facilities to produce seedlings, machinery (such as seedling extraction machine and soil mixers), and material (such as frames and soil for containerized seedlings) in order to produce a large supply of containerized seedlings at a low cost.