JAPAN TWO BRs, NO HEAT: $1.1 MILLION TO BUY

To Americans, it sounds crazy. But to Naoki Wada, 42, and his wife
Keiko, 38, the idea of living in a two-bedroom house, without central
heat, that is valued at the equivalent of $1.1 million is all part of
being Japanese.
The Wadas and their children -- daughter Sachiko, 15, and son
Naohiro, 13 -- are typical of big-city dwellers in Japan today. At
861 square feet, their house in Yokohama, a Tokyo suburb that is also
Japan's second largest city (pop. 3.2 million), is about 10% smaller
than the average Japanese abode. It's also less than half the size of
a typical U.S. home.
What is even more amazing is that the Wadas can afford to live in
a $1.1 million house on their annual income of $82,000. Naoki earns
$73,000 as a rock music promoter for Yamaha Music Foundation,
established by the musical- instrument maker; Keiko brings in another
$9,000 as a part-time receptionist and assistant teacher at a school
that teaches conversational English to children. What's their secret?
Subsidies. Like virtually all white- collar employees of major
Japanese companies, the Wadas' housing costs are largely borne by
Naoki's employer. They rent their two-story place from Yamaha for
$160 a month. That break enabled the Wadas to buy a tiny
(172-square-foot) studio apartment in Yokohama last year for
$160,600. They rent the unit to a college student for $450 a month.

Although the Wadas are generally pleased with their living
situation, most middle-class Americans would find much to complain
about. Sachiko and Naohiro must share a bunk-bedded room. The galley
kitchen's tiny range has only three burners. The house's single
toilet is essentially a porcelain pit. To heat their home, the Wadas
use kerosene space heaters and electric carpets that look like thick
electric blankets.
Unless they squeeze into the studio they own, the Wadas will have
to buy or rent another place after Naoki retires from Yamaha.
Fortunately, he figures, he will have inherited -- and sold -- his
parents' $1.5 million house in Osaka by then. ''Since you cannot
afford to live in a high-cost area like Tokyo on a pension,'' he
says, ''we'll buy an American kit and build a log home in the
country.''
Keiko has another idea, however. After an $11,000 family trip to
Disney World, New York City and Washington, D.C. last year, she
concluded that they should retire in the U.S. Says she: ''In a nice
section of Washington, $450,000 will buy a house that's about five
times bigger than ours.'' Naoki, who wonders whether crime in America
is really as prevalent as it seems from news reports, is unconvinced.
''My wife and I,'' he says with a smile, ''might have to divorce when
I retire.''