Conversion is basically a problem to be solved by the market. A choice between converting and reconstructing a building and among converting different uses like condominiums, hotel rooms, SOHO's, etc. are both to be left to the market. Here, the administrative intervention must be taken unless there occurs any town or housing problem caused by the market failure.
Discretionary interferences must not be taken because of any ‘policy failure’. Instead, it is strongly recommended to provide market players with social infrastructures to make themselves adapt to the market changes and to minimize unfavorable effects of the policy failure.
For it, enlarging time period for carrying forward of net losses is required in the corporate income tax system. It is not requested as a temporal political tax policy but is essentially needed as a part of the permanent tax system for neutrality and equity of the tax.

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The building for habitation in the central part of a town is mainly owned by unit ownership in Japan. When a building owner is going to do conversion, a repair work is required. But, it is difficult to procure the funds. Since it is common that the mortgage is set as a building, it is necessary to erase a mortgage. For erasing, the owner has to repay a part of debt at least in a bank.
If the owner of a building is going to cover the expense with the price which sold off the building pratially, the requirements for unit. ownership will be a problem. Since the space for habitation and business-use space are intermingled, menagement of the building is difficult in the building of partial conversion.
It will be easy to perform conversion, if the remaining tenants leave spontaneously, but it is difficult under the present Land Lease and Building Lease Law.

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The Study aims at examining the necessary and the direction of reorganization of real estate systemfrom viewpoint of building conversion. It is necessary for current real estate system in Japan to bereorganized by building conversion in order to supply comfortable, safety and self-building stylehouses, to realize ecological social system and to reactivate city. For this end, it is necessary tostrengthen relationship between urban planning and real estate development, control activities inbuilding by government, and management of common space by common association.

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The life of the architecture in Japan is relatively short. The long term application of the structure hascome to be evaluated even in our country. The reasons are global environmental problems andincrease of the risk of a newly built building business. The conversion is the method that revives thestructure that lost competitive power by repair. The new function is being formed to implement theconversion. There is the possibility that the new function develops the real estate of Japan into correctdirection. On the other hand, there is the problem that the conversion is not positioned correctly on apolicy.

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It is expected that to convert existing buildings into flats provide new dwelling types, which havenever been by new construction. In this paper, the followings indicate the roll of conversion in housingmarket. The first is a story on selecting a flat in Chicago. The second is the introduction of loftconversions that are characteristic dwelling units emerging into housing market in other countries.And the last is a case study on converting an office into flats in Tokyo.

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This paper presents how bad loans were recovered by real estate auctions using thecondominium data from Osaka district court in 1997-2000. The empirical analysis found that more than 70 percent of all condominiumwas sold and the ratio of recovered loans reached 70 percent on average, but that of loans related to specialcommercial trades was extremely low. The 1998 law amendments lowered sold prices on average, but anincreased sold rate may have augmented the “expected ratio of loans to be recovered.” The minimum prices setby the count were found four times higher than the highest bidding prices in 1997. Since the lenders receiveddamages by such inappropriate minimum prices, minimum prices should be used as “reference” to giveexogenous and reliable information to possible bidders.

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The purpose of this paper is to analyze theoretically the effect of the actual property tax in Japan using theoption model, comparing with the traditional model.
The model of the most literatures (the traditional model) is the NPV model and assumes that the propertytax levies in proportion to the property value, that is to say, the effective rate of the property tax to theproperty value is constant. However, in Japan, the effective rate of the property tax changes year after year. Because the land and the building are levied separately, the target value of the building doesn't depend on thevalue capitalized the future income but the construction cost, and the target value of land isn't always the landvalue, although the nominal rate of land and building tax is constant. Therefore, the actual effect of the propertytax in Japan is different from the effect in the traditional model.

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