Issues in the Quality and Volume of Information in the Real Estate Markets: A Case of Foreclosure System in Japan

Abstract

Property values depend on the volume of transactions in the market and appropriate information may decrease risks of transactions. Lower risks associated with increased participants will lead to higher prices in the market. In case of Japan’s foreclosures, the number of market participants was very small because of high risks stemming from legal procedures. The successive law amendments lowered those risks, but the remaining risks are still estimated to lower the prices of sized properties by 20 to 30％. The volume of information on seized properties provided via the internet, however, is much greater than that of ordinary ones. Therefore, not only the volume of information but also the quality of consultation by professionals are important for deceasing risks and promoting transactions in the real estate market.