Japan Press: BOJ fears housing bubble amid surging mortgage loans

The Japan Times carried an article on rising concerns over housing bubbles in Japan, as cited by the BOJ officials.

Key Quotes:

“The BOJ is concerned that the active lending may cause an oversupply of rental homes and an increase in vacancies, resulting in defaults by borrower landlords.”

“A senior BOJ official said some loans raise doubts about whether the profitability of property has been accurately evaluated.”

“The central bank is concerned that if banks extend loans to construction projects that do not pay due heed to real demand, including rental homes constructed in inconvenient locations, a housing bubble could be formed.”

“The BOJ, therefore, plans to focus on loans for apartment buildings in its on-site inspections of banks during fiscal 2017, which started April 1.”