Abstract
When the tenure of a housing lease contract expires, the Japanese Housing Lease Law obligates the landlord ID renew the contract if the tenant so requests. On the other hand, the past court rulings allow the landlord to increase the rent only mildly at the contract renewal It has been considered, therefore, that the Housing Lease Law has been restraining the supply of rental housing, especially those with large floor spaces.(The Law would not have much effect on those with mall floor spaces because their turnover ratio is high anyway.)
Recently, a claim was made that Housing Lease Law is not restraining the supply of rental housing because it is observed that the unit rent the rent per floor space goes down as the size of the floor space increases. This observation, however, maybe caused by the fact that smaller houses are locazedcloser to the CBD.
The current study examines the relationship between the floor space and the unit rent after controlling the proximity of each house to the CBD in a micro data for an Osaka suburb. The result shows that the unit rent and the floor space have a statistically significant, positive relationship.
