What was the mortgage interest rate when Japan's real estate collapsed?

Prelude to the crisis: Plaza Accord The origin of Japan's economic bubble is inseparable from Plaza Accord. From 65438 to 0978, the second oil crisis broke out, energy prices rose sharply, and serious inflation occurred in the United States. In order to control inflation, the Federal Reserve raised the federal benchmark interest rate three times and implemented a tight monetary policy.

This policy has raised the interest rate in the United States to about 20%, attracted a large number of overseas funds into the United States, led to a sharp appreciation of the US dollar, and caused a sharp increase in the US foreign trade deficit.

In order to improve the trade deficit, the United States hopes to improve its export competitiveness through the depreciation of the US dollar. 1In September, 1985, led by the United States, the United States, Japan, Germany, France and Britain held a meeting in new york Plaza Hotel, and decided to jointly intervene in the foreign exchange market to promote the orderly depreciation of the US dollar, which was called the "Plaza Agreement" in history.

After the Plaza Agreement was signed, the five countries began to sell dollars in the foreign exchange market, and the dollar depreciated, and the currencies of the other four countries appreciated accordingly. Among them, the exchange rate of the Japanese yen against the US dollar doubled in three years, from 240: 1 to 1.

The sharp appreciation of the yen has hit Japanese export enterprises, and the Japanese government has adopted a loose monetary policy in order to support enterprises to maintain high export volume and reduce corporate debt.

The interest rate has been lowered for five consecutive times, from 5% of 1985 to 2.5% of 1987, and the money supply has exceeded double-digit growth for four consecutive years, resulting in a large excess of liquidity in the domestic market.

Today, the industry is still controversial about whether the Plaza Agreement directly led to Japan's recession, but it is undeniable that a series of reactions and government responses triggered by the Plaza Agreement have led Japan to a point of no return.

The bubble in the sun kept the production and export of Japanese enterprises by lowering interest rates, and the foreign exchange earned by enterprises kept pouring into Japanese banks. In order to expand its operating profit, the Bank of Japan tried its best to make use of ultra-low interest rates to issue loans.

Compared with ordinary corporate loans, the risk of real estate mortgage loans is lower, so Japanese commercial banks invest their funds in this field.

A large amount of bank loans flowed into the real estate market and began to push up housing prices. From 65438 to 0987, house prices in Tokyo rose by 53%. Those company employees who are immersed in their work are afraid of rising house prices and are busy borrowing money from banks to buy houses. And real estate developers even organized a group of unemployed people to queue up late at night as buyers, thus stirring up the mighty wave of buying houses by the whole people.

1987, a group of commercial houses in Tokyo drew lots with a total price of 62 million yen and 55 square meters, with a lottery rate of 1/3700. NHK reporter interviewed the young mother who didn't win the lottery. She said she was really unlucky. There are two children in our family and we really want this suite. The reporter encouraged and comforted her to continue her efforts next year. But in fact, the winning rate of 1988 reached 1/6200, and the mother's hope of winning the lottery was not as high as that of betting on horses.

During the same period, the influx of international hot money accelerated the expansion of Japan's real estate bubble. Since the signing of Plaza Agreement, the yen has been appreciating at an annual rate of 5%, and keen international capital has rapidly poured into Japan, making it shine in Japan's stock and real estate markets.

The influx of hot money led to a rapid rise in stock prices and house prices, attracting more international capital to speculate in Japan, the yen continued to appreciate, the stock market house prices continued to rise, and the bubble was getting bigger and bigger.

Bank loans and hot money poured into the real estate industry at the same time, and Japanese land prices began to soar wildly. 1989, the land price in Japan climbed to 2 137 trillion yen, while at the end of 1998, the lowest price was 1388 trillion yen, and the bubble value of 749 trillion yen was equivalent to twice Japan's gross national product. At that time, there was a joke that only the land price in the 23rd district of Tokyo could buy the whole United States.

No.5 Tomoko, Ginza, Tokyo 1989, lives in front of the guild hall. At that time, the public land price announced by the Ministry of Land, Infrastructure and Transport was 1 m2 1 10,000 yen, equivalent to $970,000. This is also the highest land price in the world that won the Guinness Book of World Records that year. Now the price is 40 million yen, almost 2/3 lower. shhuang44ss

However, the soaring real estate prices have caused a series of adverse effects on the Japanese economy.

First of all, it has seriously affected the development of the physical industry. Due to the high price of construction land, it is difficult for many factories and enterprises to expand their scale. Toyota Motor, Fuji Heavy Industries, Hitachi Electric and other Japanese real economy leaders began to enter the real estate industry on a large scale. In the same period, the annual growth rate of Japan's nominal GDP was only about 5%.

Secondly, the high land price has also brought serious obstacles to the government's public investment and construction. The second Dongming Expressway under construction at that time was difficult to advance because of the high land price, and the operating conditions of the Japanese road commune deteriorated extremely.

Thirdly, agricultural land is squeezed in large quantities, and domestic agricultural output is threatened.

High housing prices make ordinary Japanese unable to afford their own houses. 1990, I bought a small house of 60 square meters in Tokyo and spent more than 50 million yen. Basically, according to the salary standard of 4 million yen at that time, it took 15 years not to eat or drink, which made many Japanese young people who dreamed of going to Beijing forget. Even many Japanese nationals think that Tokyo people get something for nothing and criticize the government for raising land prices.

In the lost 20 years (1990), the proportion of loans in Japan's productive industries dropped to 25%, while the proportion of loans in non-productive industries rose to 37%. Japan's seemingly prosperous economy has become a veritable castle in the air, and the crisis is imminent.

The Japanese government is also aware of the economic bubble, and the irrational property market is shaking Japan's two basic national policies of "basic farmland system" and "rejuvenating the country through science and technology". As a result, the Japanese government suddenly contracted its monetary policy.

First, raise interest rates in the short term. 1In May 1989, the central bank raised the ultra-low interest rate, which had been maintained for more than two years, from 2.5% to 3.25%, and then raised it four times in a row, reaching 6% in August 1990.

Second, the government was suddenly forced to tighten credit and control the total amount of real estate credit. 199 1 year, commercial banks stopped lending to real estate, and the growth rate of M2 dropped sharply from the 90-year average of 1 1.68% to the 9 1 year average of 3.66%, far below the nominal GDP growth rate of 6% in that year.

The macro-control policy was too strong, and the bubble soon burst.

The first thing that punctured was the stock market bubble. 199065438+1October 12 was the darkest day in the history of Japanese stock market.

On the same day, the Nikkei index plummeted and the Japanese stock market plummeted by 70%. Since then, the Japanese stock market has fallen into a bear market for 20 years.

The stock price has fallen sharply, the scale of credit has declined, and almost all banks, enterprises and securities companies have suffered huge losses. The bankruptcy of the company led to the influx of a large number of real estate owned by it into the market, and suddenly the real estate market appeared oversupply, and the house price showed a downward trend. At the same time, with the narrowing of the yen arbitrage space, international capital began to flee.

199 1 year, Japan's real estate market began to collapse, and a huge real estate bubble burst from Tokyo and quickly spread to Japan.

1992, the Japanese government issued a "land price tax" policy, which made matters worse, stipulating that all land holders must pay a certain percentage of tax every year. Owners who hoarded a lot of land during the real estate boom sold their land one after another, and the Japanese real estate market immediately entered an era of "oversupply".

The superposition of several factors has accelerated the overall collapse of Japan's real estate economy. The housing prices in the three metropolitan areas (Tokyo, Osaka and Nagoya), which were much higher than the national average during the bubble period, also fell the worst after the bubble burst, and the decline exceeded the national average.