Emergency Priority Program for Reducing Housing Construction Cost

March 26, 1996

The Ministry of Construction
The Ministry of Justice
The Ministry of Health and Welfare
The Ministry of International Trade and Industry

High cost structure of Japanese economy is being pointed out from various sectors. With regards to the housing sector, it is necessary effort be made in lowering housing construction cost in order to make possible enjoyment of truly affluent housing life by the people at reasonable cost. Toward this end, in a cabinet meeting decision on the action plan for rectifying high-cost structures and increasing industrial dynamism in housing construction (hereinafter called the"Action Program") it was decided to target lowering of average housing construction cost to approximately two thirds of hitherto level by FY 2000 as a part of "Social and Economic Plan for Structural Reforms" of December 1995.

Moreover, it is felt necessary to further promote deregulation in line with economic social structural reform and international cooperation. With regard to housing sector, from a point of view of harmonization with international standards, enlargement of people's freedom of choice, correction of high cost structure relative to housing construction through comprehensive review of building regulation system and introduction of less expensive foreign materials attended with said review is said to be a pressing problem.

While attending to these new problems, in order to aggressively realize targets of the Action Program, it is necessary to further develop general and nationwide housing construction cost reducing policy by taking an opportunity of starting the 7th Housing Construction 5 Year Plan in FY 1996. It was therefore decided to prepare "Emergency Priority Program for Reducing Housing Construction Cost" centering on priority matters to be taken up during fiscal year 1996.

By successfully realizing this plan. Formation of Creative 21st. Century Type System is to be promoted in the housing sector.

1. Comprehensive Review of Building Regulatory Framework.

(1) Comprehensive Review of Building Regulatory System

1) Rationalization of Building Regulatory System

In order to create rational regulatory system which more accurately responses to international cooperation, promotion of deregulation and other needs of the time Building Council is now investigating and deliberating on "How New Building Administration Should be in the Face of Economic Social Changes Looking into the 21st Century". On the basis of Building Council's investigation and deliberation new systematic framework for building regulations is to be prepared during FY 1996, there upon tangible preparation of the system, such as legal measures, are to be undertaken promptly thereafter.

2) Introducing Performance Concept to Building Regulatory System

Amongst studies under 1) above, as for building regulatory system, in particular, from a point of view of harmonization with international standards, induction of self-responsibility system, enlarged people's choice freedom, and inducement of technological developments, present system centering on prescriptive regulations is to be basically changed to performance-based regulations.

3) Performance-based Regulations of Wood Frame Construction Technical Standard

As for housings by wood frame construction method (i.e. 2 x 4 method, etc.) technical standard of structural method thereof is to be precedentially performance-based during FY 1996.

(2) Comprehensive Review of Regulations on Water Supply

1) Review of Regulations on Plumbing Fixture Contractors

In order to relax regulations on plumbing fixture contractors in performing works for appointed water works utilities which require office within their service area, national qualifications shall be established for plumbing fixture engineers so that any contractor with qualified engineers may be appointed and undertake work for any waterworks utilities.
For this purpose, the revision of Water Works Law is currently been submitted to the Diet.

2) Rationalization of Water Supply Equipment Regulations

With regards to water supply equipment, national standards for the equipment structure and materials shall be clarified in an effort to establish performance-based standards of these. Attended with this, water supply equipment type approval and quality inspection presently required prior to use will be amended with general review of present system to a system in which it will be up to consumer whether or not to use one of products certified by an independent certification organization. This is expected to be enforced from FY 1997. In the new certification system by an independent third-party organization, in-house inspection and random sampling systems shall be inducted for radical simplification, whereas with present type approval system total sampling is required,. Moreover, in order to promote international harmonization of regulations, mutual recognition with overseas certification organizations shall be promoted.

(3) Introduction of Factory Prefabrication System for Gas Piping Works

The Factory Prefabrication System for Gas Piping Works will be implemented as of July 1996. This new measure is aimed to enhance housing manufacturers to practice laying gas pipes by themselves at their own factories under certain standards.

2. Facilitate Induction of Imported Housings and Foreign Materials and Components

In order that Japanese consumers have a larger selection to choose regarding housing construction, it is necessary to create highly competitive housing market. Moreover, based on need for international cooperation and existence of price differences between Japanese and foreign housing construction costs, with regard to imported housings and foreign materials and components, in particular, there is need for preparation of conditions for their smooth introduction. For this reason there is a pressing need to forge ahead with following policies:

(1) Promotion of Mutual Recognition on Building Codes and International Harmonization on Building Standards

In order to streamline certification process for building materials, discussions with related foreign organizations shall be promoted for mutual recognition on building codes so that mutual acceptance of building materilas may be facilitated by,for instance,recognition of foreign testing laboratories which can supply acceptable test data.
Further, with regards to foreign materials and components, in order to improve their access into Japanese market international alignment of JIS and other standards are to be promoted.
As for wood frame construction method, in particular, it is necessary to arrange that among the materials which comform to overseas common standards, some materials like lumbers, plywood, etc. that have sufficient structural strength with proper quality control system and have many things in common with Japanese products may be used for wood frame construction in Japan, provided that conformity with the said overseas standard is certified and indicated. In view of the above, discussions with overseas organizations concerned shall be proceeded with 3 countries and 10 organizations and for 30 types of building materilas as an aim within FY 1996.

(2) Facilitation of Supply of Housings Using Foreign Materials and Components

In order to facilitate supply of houses using foreign materials and components, such as wood frame construction method, examination for certification by the Minister of Construction under Building Standard Law Article 38 of special building materials and structural methods must be rationalized, and examination standard for introduction of housing employing foreign methods be prepared.

(3) Establish "Housing Import Information Dial"

It has been pointed out existence of legal obstacles such as building regulations, facilities related regulations in induction of imported houses, foreign materials and components into Japan. In order to promptly and generally grasp these pointed out matters "Housing Import Information Dial" is to be introduced utilizing Internet. Information collected at the "Housing Import Information Dial" are to be made public periodically, while at the same time notify relevant organizations for necessary corrective actions.

(4) Promote Propagation of Foreign Building Materials by Holding "Imported Construction Materials and Equipment Fair"

In order to promote propagation of foreign building materials, etc, while promoting exchange of information between foreign building material producers and Japanese housing manufacturers, it is also necessary to increase opportunities for supplying information to foreign suppliers wishing to enter Japanese market. For this purpose, "Imported Construction Materials and Equipment Fair" jointly sponsored by relevant organizations, is scheduled to be held at Yokohama during FY 1996 with suppliers from many foreign nations being asked to participate, while at the same time insuring wide publicity of the Fair to the domestic housing manufacturers and other related people for providing effective place for supply and exchange of information. Coinciding with opening of the Fair. housing and construction industry organizations and other interested parties are to be invited to attend Import Promotion Conference for active utilization of foreign building materials, etc.

(5) Utilization of JETRO Imported Housing Exhibitions and JETRO Housing Materials Centers

In order to promote propagation of imported housings, 8 existing JETRO Imported Housing Exhibitions are to be actively utilized for providing necessary information to the consumers. Further, to promote dissemination of foreign materials and components, 2 existing JETRO Housing Materials Centers are to be utilized to provide information as well as to promote business talks.

(6) Expediting Immigration Procedure for Foreign Skilled Labors Participating in Construction of Imported Houses

Based on Immigration Control and Refugee Recognition Act and Ministry of Justice Ordinance, when granting skilled labor resident status to foreign skilled labors participating in construction of imported housings, efforts are to be made to quicken examination procedures to 2 to 3 weeks from the time applications for necessary resident approval certificate to be granted to the said foreigners are made.

3. Promotion of Leading Projects for Reducing Housing Construction Cost

In order to widely publicize effects of various policies for reducing housing construction cost to housing manufacturers and consumers, following model projects are to be actively promoted.

(1) Undertake Model Projects for Utilizing Foreign Materials and Components

Housing and Urban Development Corporation (HUDC), regional housing supply public corporations and other public housing supply organizations are to undertake model projects during FY 1996 to indicate to both consumers and housing manufacturers possibilities of foreign materials and components and to set examples in using foreign materials and components while at the sometime grasping cost reduction effect.

(2) Construction of Low Cost Model Housing Development

In order to widely publicize to public general of standard type housings, etc. incorporating "Plus You" housing, imported housings, reduced option specifications and to promote propagation of low cost housing market low cost model housing developments by all prefectures in the nation are to start preparation thereof in FY 1996.
For this purpose, HUDC, regional housing supply corporations and other public housing supply organizations themselves are to make active effort in creating low cost model housing developments, while central government and regional public organizations are to assist in planning, designing, exhibitions, etc. when public housing suppliers, private sector housing supply cooperative enterprises undertakes low cost housing developments.

4. Preparation of Positive Support Organizations for the Consumers

To cite and example for high housing construction cost in Japan is due to lack of information of consumers on housing construction, and consumers taking not necessarily appropriate selection procedure due to the foregoing. With most Japanese consumers, house is an " once in a life time purchase" , there is also a limit to information gathering by consumer alone. For this reason it is necessary to prepare an environment in which accurate information can be obtained by a consumer and so that consumers may have larger freedom in choice, Following policies are to be actively promoted.

(1) Prepare "Housing Up Center"

At least one "Housing Up Center" in each of the prefectures in Japan is to be established during FY 1996 which are to be provided with such information from basic knowledge to specialized information on housings and housing construction materials and components, including information on imported housings and foreign construction materials and components, in order that consultations from consumers can be accurately responded.

(2) Preparation of Housing Performance Evaluation Indication System

In relation with durability, insulation and other performance properties of a house, evaluations and indications are to be made based on unified items and standards while considering cost to the consumers. As it is possible to compare and study housing performance that by creating unified framework for housing performance and indication efforts shall be made to prepare housing performance and indication system.

(3) Activation of Housing Market

In order to enlarge consumer's freedom of choice, it is necessary that housing market be activated through enhanced competition by promoting new entries into housing market, supply of highly durable and alterable housings, development of resale housing market, promotion of housing remodeling, etc. To this end, the scope of housing performance warranty scheme is to be expanded to include as their objects rental and resale housings. Also, information supply system for house remodeling is to be established to provide information on the contractors and so forth. Moreover, research and development on housing production and supply system shall be conducted, while promoting the project,"House Technology Development for Creative Life".

5. Promotion of Housing Production Rationalization Program

With present state of Japanese housing manufacturing system, it has been pointed out from various circles as a result of various problems, such as productively, multi-tier subcontractor structure, multi-tier multi-phase distribution system, have contributed in raising housing construction cost. In order to solve these problems it is necessary to give actively support medium and small housing manufacturers in enhancing productivity and quality control, strengthen management base, etc, while rationalizing housing material distribution system. For this purpose the following are to be promoted.

1) In order to propagate superior but low cost housing production system to medium and small housing manufacturers supports and guidance are to be provided for cooperative production and intensified informationalization of the medium and small housing manufacturers.

2) Prepare regional centers which will serve as prefecture level housing industry modernization nucleuses.

3) Augment training facilities for securing and educating building construction skilled labors.

4) Rationalize distribution system by informationalizing housing material and component industries,encouraging standardization of housing components and equipment concering their sizes and methods of installment.

5) Technological developments of durability, aseimaticity, energy conservation, barrier free and others technologies agreeing with medium and small housing manufacturers characteristics.


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