Accuracy (or lack thereof) in the yen-to-dollar rate.
April 18, 2008 12:45 PM   Subscribe

Is the Land of the Rising Sun still expensive? Expats (recent and current) and erstwhile tourists, chime in.

In American dollars, can Japan still be regarded as an "expensive country?"

You're probably thinking, "At 103.88 yen to the greenback?? You've gotta be kidding." Ten years ago, this argument may have been viable. But this article paints an entirely different picture. The gist of the author's claim is that, while American consumer prices have undergone moderate inflation for the past 13 years, Japan's prices have been flat. Adjusted for inflation, the "correct" yen to dollar rate should be 73 to the dollar (based on a former valuation of 100 yen to the dollar in 1995.)

But the only way to get a handle on this question is rote, product-by-product comparisons. Okay, I know that certain items--like luxury import cars, or cups of coffee in Tokyo--are still expensive due to inefficient import markets and high rental costs. But I'm more interested in the big picture--the price of living, working, and getting around Japan every day. Based on this metric, and a lot of gut feeling, does Japan strike you as pricier than the United States? What's more expensive; what's less expensive?

If you were working at the Bank of Japan, and were granted awesome superpowers allowing you to rectify the yen-to-dollar rate so that it reflected the cost of living in Japan and the US, what would you peg it at?
posted by Gordion Knott to Work & Money (8 answers total) 6 users marked this as a favorite
My sister is currently in London and yearns for the dirt-cheap Japan prices.

Where in Japan are we comparing? I would say that during my time visiting my sister while she was in Nagasaki (ok, about 3 years ago now), that the prices were only marginally higher than what I encounter here in Pittsburgh, PA. Rents were in the range of about 60,000 to 100,000 yen per month for not-unreasonable apartments of varying sizes and locations. Getting around by bus was in the range of 100 to 250 yen, essentially the same as now. I could happily find restaurants of perhaps slightly-higher-than-US quality with meals for under 800 yen. KFC and Subway were probably more expensive in Japan than in the US, American-style fast food in general. The quality of 100 yen shops is amazingly better than that of our dollar stores. Produce and meats are more expensive in general due to the lack of available pasture and farmland in Japan--when most foods are imported, the price goes up.

Tokyo, on the other hand, I know nothing about. But . . . there are places in Japan that aren't in Tokyo, and just like places in the US that aren't New York and San Francisco (and other dense desirable cities), the prices do tend to vary from rather cheap to cutting-my-own-throat expensive.
posted by that girl at 2:38 PM on April 18, 2008

What's more expensive?
for most things, i don't find japan prices (tokyo or outside) to be ridiculous. The things I feel gouged on are gas, public pay phones, cheese, butter (there's a shortage here, did you know? I spent nearly $40 for 2 kg of butter last week, and the prices will go up about 10% next month), trains, and fruit. Rent's about at New York levels in Tokyo, it seems, except that there are smaller apartments available for still ludicrous fees (say 11 m2 for $500-700 a month)

what's less expensive?
that girl has it right about the value - a tasty meal at a restaurant can be $4 and the 100 yen shops have stuff you'd actually want and is actually quality.

In summary, my gut feeling is that the average price level feels New York to me. Even the Japanese come back from London saying good god, that was expensive. And the food's a lot worse.
posted by whatzit at 5:05 PM on April 18, 2008

Well, this is kind of dated, but from the tourist perspective, we spent two weeks in Tokyo the winter before last, and felt that it cost exactly the same as spending two weeks in Seattle--hotels, restaurants, site seeing, etc.--comparing similar establishments. Of course there are the typical Japanese exceptions like the bizarrely perfect and exorbitantly priced fruit and so forth, but in general we were amazed at how directly comparable the prices were to those at home.
posted by Enroute at 5:23 PM on April 18, 2008

I live in northern Japan, and it is so incredibly cheap compared to suburban Los Angeles, which is where I was before. My rent is about $400 a month, my cell phone bill is about $25, and yesterday I had a 45 minute massage for less than $25, and, of course, I didn't have to tip. The only things I find expensive are the trains and my gym membership, almost $95 a month. (Total waste of money, they don't open until 10am and they just replaced some instructors w/ videos.)

I recently visited Kobe and Kyoto. Everything seemed slightly more expensive, but nowhere near London prices.
posted by betweenthebars at 9:13 PM on April 18, 2008

japan is interesting, but they see "value" very different from americans.
for instance, they would prefer to pay more and get good service, than reduce service but get better value. this is a difficult paradigm to understand in some areas.
also, tips generally make them uncomfortable, they prefer not to be tipped.

import cds are cheap, local cds are expensive.
pizza is excessively expensive, alcohol is inexplicably cheap.
real estate in the big cities is expensive, train tickets are expensive, cars are really cheap.
service industries are expensive, seven eleven pays its workers nothing.
import goods are not expensive, for instance porsche cars are cheaper than i have seen anywhere by a big margin. but niche products are quite expensive, such as american collectors items.
rent, childcare and medical expenses are relatively very expensive, so i would encourage that if your question is related to your situation (such as you are going to work there) plan out category by category, instead of trying to find a general conversion.

i think your question is impossible to answer, except using the best reference possible:
a big mac meal at mcdonalds is 560 yen, or i think 610 for the upsize.
so about 105 yen to one Us dollar is "generally" about right
posted by edtut at 11:16 PM on April 18, 2008

MY wife, child and I went in January for two weeks of sightseeing. We're from Australia and prices of accommodation, food, drinks, skiing etc were cheaper than here - that goes for the ski fields, Tokyo and Osaka. The only equitable item was beer (About the same in Aus and US as Japan), everything else was cheaper.

That didn't stop us spending waaaaaaaay over budget (we had a great time though).
posted by micklaw at 12:45 AM on April 19, 2008

Went a couple of years ago... the pound was strong so things didn't seem that expensive at all...
Things that stood out as expensive... taxis, drinking in bars (but booze from shops is cheap), the cinema.
posted by fearfulsymmetry at 2:39 AM on April 19, 2008

Renting a normal apartment in Tokyo generally requires a 2-5 month deposit of "key money" and "thank you money", much of which you don't get back. You also have to pay an extra 1-2 months when you renew your contract after two years.

Local taxes vary by area, but where I live they are something between 5 and 10% of my yearly income.

Produce is mostly imported and much more expensive than in America as well.

I have no idea how to answer your question, but the weak dollar is nice when you live abroad and have American debt.
posted by ejoey at 7:04 PM on April 20, 2008

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